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New Times / News

The following article was posted on November 21st, 2012, in the New Times - Volume 27, Issue 17 [ Submit a Story ]
The following articles were printed from New Times [newtimesslo.com] - Volume 27, Issue 17

County goes on the defense over Excelaron denial

BY MATT FOUNTAIN

Are Excelaron and its handlers just being sore losers? Or did the county deny the subsidiary for two major foreign-owned oil companies a fair shot?

On Nov. 19, Excelaron L.L.C. filed a petition in San Luis Obispo Superior Court for damages against the county for its denial of Excelaron’s plans to drill as many as 12 wells in the rural Huasna Valley, some 10 miles east of Arroyo Grande.

A unanimous county board of supervisors voted against the project on Aug. 21, finding it wasn’t a good fit for the community, with the area’s characteristically narrow roads and long response time from local emergency services, among other concerns.

Now Excelaron is seeking to recover “just compensation” for the value of its mineral estate—in addition to attorney fees and other litigation costs.

According to the lawsuit, Excelaron contends that the county abused its direction in its denial of the Huasna Valley project. Specifically, it reads, the county unlawfully applied “new and unwritten standards” and interpreted its own policies in a way that doomed the project to fail.

Furthermore, the suit contends that the county ignored its own findings in the decision, and that findings “were not supported by substantial evidence in the record.”

“The county will not approve any oil development in the Huasna area,” the lawsuit reads. “Accordingly, the petitioner has been prevented from accessing or utilizing its mineral estates, which, as separate and legally distinct property interests under the law, have been deprived of all economic value.”

The corporation contends that its mineral estate—encompassing an area of roughly 720 acres—is worth an estimated 208 million barrels of oil, appraised at approximately $6.24 billion. The release claims that the Excelaron project, if approved, would have produced up to 1,000 barrels—or roughly $100,000 worth of oil—daily for a substantial portion of the life of the project.

Deputy County Counsel Tim McNulty told New Times the county had yet to officially be served the lawsuit as of press time.