Thursday, April 10, 2008

Environmentalists applaud oil agreement


Local environmental leaders hailed an agreement reached with an oil production company to phase out existing oil and gas operations off the coast of Gaviota and Lompoc as groundbreaking and unprecedented.
Members of the Environmental Defense Center, Get Oil Out! and Citizens Planning Association, among others, gathered with representatives from Plains Exploration and Production Company (PXP) on Thursday to unveil their plans to curtail oil development and turn over PXP-owned land to the public in perpetuity.

“In the next several years, we will see a shutdown of oil production along the coast of Santa Barbara,” said Linda Krop, chief counsel for the EDC.
In order for that to happen, she said, they had to support a PXP proposal to drill into an offshore oil field near Lompoc.
Essentially, PXP wants to explore the Tranquillon Ridge field for oil and gas reserves — an area located in state waters near Platform Irene. Since the oil company is currently draining the Pt. Pedernales field from that platform, in nearby federal waters, they could use the same infrastructure for Tranquillon Ridge.
But a prior attempt by Nuevo Energy Company to do just that was fiercely opposed by local environmentalists and shot down by the County of Santa Barbara in 2002. PXP executives knew they needed environmental leaders on their side in order to get state and county approval.
“We were looking for an innovative and creative solution to what is normally an insurmountable challenge in Santa Barbara County,” said Steven P. Rusch, PXP’s vice president of environmental health and safety and government affairs.
“They came to us and said whatever you want,” Krop said. “…We didn’t really have to give anything up.”
Under the legally binding agreement, signed Wednesday, PXP will end all operations at Tranquillon Ridge and Pt. Pedernales, along with the onshore Lompoc Oil and Gas Plant, by December 2022. PXP will also close down three platforms off Point Conception and shutter an oil processing facility on the Gaviota Coast by 2017.
Without the agreement, Krop and other environmental leaders stressed, those oil operations could continue indefinitely.
“The crux of our support for this agreement is the end date,” said Naomi Kovacs, executive director of the Citizens Planning Association.
PXP also agreed to reduce and offset all greenhouse gas emissions created by the proposed drilling project. The energy company will initially hire an independent consultant to audit Platform Irene and must implement any feasible measures to reduce emissions.
“We get a benefit right off the bat,” Krop said.
Any remaining emissions will be reported annually to the county’s Air Pollution Control District and offset by payments from PXP. On top of that, the oil company will fork over $1.5 million to the APCD to further reduce greenhouse gas emissions locally, potentially through the purchase of hybrid buses or similar measures.
Once production ends at PXP sites, either by a lack of commercial oil quantities or the shutdown deadlines, the oil company will turn over approximately 3,700 acres in the Lompoc Valley and 200 acres on the Gaviota Coast to the Trust for Public Land for preservation and restoration.
“That alone is incredible,” Kovacs said.
The agreement will also wipe out plans for a large residential project on 800 acres in the Purisima Hills near Lompoc. Instead, environmental groups hope that land will be folded into the Burton Mesa Ecological Reserve along with other PXP property, including the Lompoc Oil and Gas Plant.
“These facilities will be removed, the land will be remediated, the environment will be restored,” said Abe Powell, president of Get Oil Out!, a group formed nearly 40 years ago following the 1969 oil spill.
As one of the few organizations that has never supported an oil project in the Santa Barbara area, GOO! members had a tough time coming to grips with the proposal, Powell said.
“This is the hardest thing we’ve ever done,” he said. “At our board meeting when we agreed to this, there were tears, there was outrage. … But it allows us to do what our mission is, which is to get oil processing out of Santa Barbara County.”
PXP officials said in spite of the production deadlines, mitigation requirements and land transfers, the agreement is far more attractive than the alternative: not drilling at all.
“We’re extremely happy because we were able to craft a solution where there was none before,” Rusch said. “…I’ve worked a long time in this business and you get kind of tired of fighting.”
Still, he said, PXP is in the business of extracting oil. They plan to drill 22 to 30 oil and gas wells into the Tranquillon Ridge field, which could contain 170 million to 200 million barrels of oil and 40 to 50 billion cubic feet of gas, according to an Environmental Impact Report.
If up and running by 2009, pumping at peak capacity, PXP could conceivably pull out 110 million barrels of oil and 20 billion cubic feet of gas by 2022, potentially leaving a significant amount behind.
“If we only get 90 percent of the oil out of the ground, do we wish we got 100 percent out? Of course,” Rusch said. “Do they wish we would take down the oil platforms in 10 years instead of 14? Naturally.
“It was a give and take on both sides. In the end, it was a compromise, as all good negotiations are.”
And for local environmental groups, it serves as a model for future negotiations with oil companies. Powell said the agreement would be referenced on any discussions that happen in the future.
“Nobody is going to ignore this,” he said. “It’s such a huge deal.”
Krop enthusiastically agreed.
“It sets the bar really high.”

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