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New Huasna oil plan calls for 12 wells, instead of four 

The Huasna Valley Association is on the defensive again following an oil company’s resubmission of a plan to extract oil from the hills east of Arroyo Grande.

HVA is a group of farmers, ranchers, and others in the rural valley that has been critical of proposed oil drilling operations in the area. The SLO-based oil company Excelaron, which is owned by larger Australian and Canadian energy companies, applied for a conditional use permit with the county Sept. 23, four months after the company withdrew a similar project from consideration. Excelalron did not respond to a request for comment as of press time.

Excelaron’s first proposal was to drill four wells; the new project would allow as many as 12 new production wells to be drilled, with an additional well for wastewater. An Environmental Impact Report details the history of drilling in Huasna, including a stint in the 1980s that left several wells derelict, and possibly put water resources at risk of contamination.

The state Department of Conservation, Division of Oil, Gas, and Geothermal Resources (DOGGR) recently issued a cleanup order for several wells in the area where Excelaron hopes to drill. The cost of properly abandoning the wells has been estimated between $200,000 and $300,000, which will be paid for by the state from a special cleanup fund that is generated from bonds paid by the various operators of the drilling operations.

Residents say the plugging of abandoned wells is overdue, but can’t figure out why the state is going to pay for it, rather than the operator. Months ago, HVA members revealed that one of Excelaron’s parent companies, Canadian-based United Hydrocarbon, was an offshoot of the same company that abandoned the Huasna drilling operation 20 years ago.

Donald Drysdale, a spokesman for the state office, said in an e-mail the department “tried numerous times to contact the operator, with no response.

In other words, DOGGR asked nicely for the former operator, Deuel Petroleum, to clean up their mess, but since they didn’t come forward, the state will pay for it.
Now Deuel Petroleum has become, through a name change, United Hydrocarbon, and united Hydrocarbon owns 50 percent of Excelaron, the company applying to drill more wells in the same spot.

Ron Skinner, coordinator for HVA, said the group is outraged that the county would even accept a new application from Excelaron, given their connection to Deuel, who violated the terms of their permit in abandoning the area. A representative from the county was not available for comment as of press time.

“These existing violations,” Skinner said, “may have compromised the quality of our groundwater aquifer and should be corrected prior to consideration of any new conditional use permit.”

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