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Risky business: A 30-year-old voter initiative is at the center of SLO County's debate over Trump's West Coast drilling proposal

Camillia Lanham Mar 8, 2018 4:00 AM

Splotches of black tar smeared across portions of the Central Coast's beaches and tidal areas are teeny-weeny glimpses of the energy potential that lies beneath the Pacific Ocean.

It's tough and sticky, clinging to the sand that gives way to the Estero Bluffs north of Cayucos, marring the pure white of sun-bleached sand dollars along the high tide line at Pismo State Beach.

Illustration By Alex Zuniga

A product of natural seepage, the thick hydrocarbon leaks into the marine ecosystem out of an oil reservoir below the ocean floor known as the Santa Maria-Partington Basin. It stretches approximately 165 miles from Point Arguello near Lompoc to Point Sur near San Simeon and is about 25 miles wide. The U.S. Geological Survey estimates that the basin contains up to 2.49 billion barrels of oil and 1.44 trillion cubic feet of natural gas. A little less than half of that is considered to be undiscovered technically recoverable resources.

In other words, we have the technology to get that much of it out of the ground. The question is: Will we?

As the price of oil goes up, so does the theoretical amount of oil that could be commercially produced. The difference between $60 a barrel and $120 is about 20 billion barrels of offshore oil, according to the Geological Survey. But that's only if an oil company can purchase a lease from the federal government in the first place.

Congressional and presidential moratoriums have protected the West Coast from offshore oil lease sales in federal waters (which start 3 miles from the shoreline) since the mid-1980s. Those protections lapsed in 2009. Until recently, the West Coast was still excluded from the Bureau of Ocean Energy Management's (BOEM) five-year plans for Outer Continental Shelf oil lease sales in federal waters.

However, that—like so many other things—has changed under the Trump administration and Department of the Interior Secretary Ryan Zinke. A recent draft of the proposed lease sales for 2019-2024 includes a plan to open up the West Coast to new lease sales, six along California and one each for Oregon and Washington. The move puts the state and local interests at odds with the federal government—something that seems to be 30-year-old history repeating itself.

In the early 1980s, Shell Oil purchased one of the last federal leases sold off the West Coast. It was adjacent to San Luis Obispo County, and the fight over that lease and its future environmental risks led county voters to implement an extra layer of local protection in 1986. It's known as Measure A, and it bans the construction of onshore infrastructure that supports offshore oil production unless voters approve it.

"Measure A is a very, very powerful tool," said 5th District Supervisor Debbie Arnold during the Feb. 8 SLO County Board of Supervisors meeting. "It would be a pretty tall hill to climb to get the majority of the public to make a change to Measure A, which in essence says, 'You can't build any infrastructure.' Therefore, it's going to be pretty difficult to build anything off the shoreline of our county."

But there are some who believe the county needs to take a stronger stance, that while Measure A does offer a level of protection, it isn't enough—and it won't be enough if an oil company decides it wants to drill off the SLO coast. At that Feb. 8 meeting, several environmental activists spoke during public comment, requesting that the board put a resolution forth formally opposing BOEM's draft proposal. Second District Supervisor Bruce Gibson responded by offering up a motion. With fellow liberal 3rd District Supervisor Adam Hill absent, the remainder of the board was silent.

"Lacking a second, this dies, and that's telling," Gibson said. "It's a very sad situation that this board majority refuses to stand up to a palpable threat."

Producing hydrocarbon

In 1964, the first exploratory oil well was drilled in federal waters off the West Coast. It was at least 3 miles west of the SLO County shoreline. Nine more were drilled in federal waters off the SLO coast between 1982 and 1986, according to Public Affairs Officer John Romero from BOEM's Pacific Region.

He said that some of those wells didn't produce enough to pay, while others did, and three of the wells have incomplete records. Ultimately, though, those exploratory wells were as far as things got in the hunt for economically viable oil off the SLO coast.

Photo By Jayson Mellom
RESIST U.S. Rep. Salud Carbajal leads a press conference in San Luis Obispo on Feb. 13 against the Trump administration's proposal to open up federal waters off the West Coast to oil and gas leases.

Farther south is a different story.

There are currently 38 active, producing federal leases and 23 federal platforms in Southern California, all of which are located south of SLO County. BOEM's draft proposal details that oil and gas production in Southern California federal waters began in 1968 and had totaled more than 1.35 billion barrels of oil and 1.84 trillion cubic feet of natural gas as of December 2016.

In that time, there have been a few oil spills in the Pacific, including the 1969 oil spill in Santa Barbara. Over an 11-day period, as much as 4.2 million gallons of crude oil gushed out of a brand new Union Oil well that blew out, according to the National Oceanic and Atmospheric Association (NOAA).

NOAA stated that even after the well was capped, "fissures in the sea bottom continued to leak oil and gas for nearly a year after."

The memory of that spill, which coated 35 miles of coastline, lingered as SLO County activists took on the fight against Shell. But the resistance wasn't limited to the Central Coast.

It was sort of a statewide initiative, according to Richard Charter, who worked for a local government coordination program in Santa Cruz County at the time. There had been a federal push to develop offshore oil leases at the end of the 1970s and early 1980s. Companies were drilling exploratory wells off the coast in places like Humboldt and San Francisco, and there was talk about lease sales near Big Sur.

"We started asking the counties: What can we do on our own coast ... that would act as a deterrent to offshore drilling?" Charter said. "Somebody went around and appeared before each elected body. I helped write all of [the ordinances], and each one was worded slightly differently because we were told we would be sued, and we were."

Charter said that 24 cities and counties in the state either passed ballot measures similar to SLO County's or their elected governing bodies passed ordinances that banned new onshore oil facilities. Robert Griffin was a SLO City Council member at the time, and he helped draft the county's initiative.

"The ordinance needed to have pretty clear jurisdiction over what we were claiming it would do since the federal government has pretty clear jurisdiction over lease sales and whatever is going on offshore," Griffin said. "[We] looked it over from a land-use perspective since the county has considerable control over land use, and it had to be simple so that people would understand."

Shell Oil did test the measure, putting onshore oil facilities projects on the ballot in 1988, which SLO County voters elected to deny.

Drilling challenge

The Western Oil and Gas Association (now the Western States Petroleum Association) challenged the ordinances' constitutionality in court, alleging that they violated the Constitution's Commerce Clause. SLO County's Measure A held up alongside the rest, and that was in part due to the moratorium on offshore lease sales in federal waters. The California's Ninth Circuit Court of Appeals ruled that the case wasn't "ripe."

"The court holds that the case is not ripe because it is not clear whether any of the leases remaining off the California coast will ever be offered for sale, and the oil companies have not demonstrated that the ordinances will interfere with their bidding rights for OCS [Outer Continental Shelf] leases," the ruling from June 1990 states.

Now that there could be OCS lease sales off the California coast again, that ruling opens up the ordinances to the potential for another lawsuit, Charter said.

"The onshore facilities ordinances were supposed to be the absolute last defense," Charter said. "What you can anticipate is that the oil companies will try to knock out these ordinances again, particularly if the San Luis Obispo Board [of Supervisors] behaves like a deer in headlights."

He points to the board majority's vote against the proposed Chumash Heritage National Marine Sanctuary as further proof that the county's elected officials aren't doing enough to protect the local coastline from offshore oil drilling.

While Charter joins a number of people who believe that the county is basically "rolling out the red carpet to oil companies," Supervisor Arnold doesn't see it that way. The evidence she offers are two letters the SLO County Board of Supervisors penned last year, one of which was sent to Interior Secretary Zinke on March 7, 2017.

The letter references the county's opposition to OCS leasing for oil and gas development, mentions the environmental risks associated with drilling offshore, and points to Measure A as an "excellent gauge" to judge the will of San Luis Obispo County.

"That to me is the perfect letter, and I feel like we're in a perfect place right now," Arnold told New Times. "It lays out the sentiment of our county perfectly. It talks about what we've done as a county to protect ourselves."

Measure A was a local, grassroots effort, she said, it held up against challenges, both at the ballot box and in the courts. Griffin, who helped craft the measure, acknowledges that although the measure was supported by a majority of the county's residents, there were still people in the county who didn't support it.

"I never thought it would be used by the other side—to be used as an excuse," Griffin said. "I still think it's a valuable struggle, and I think it's disappointing that our Board of Supervisors, even though they're not as steeped in this local history, are taking kind of a narrow view."

Steve Rebuck, who worked as a fishing industry advocate for decades, signed his name to the argument in opposition to Measure A on the 1986 ballot. He did this, he said, because he felt that the offshore oil-drilling issue was a red herring.

"I really don't see this as a real threat in San Luis Obispo County," he said, adding that the county's shoreline isn't conducive to having onshore facilities in the first place. "All of the equipment that has to be taken out to those things has to be done by ship. ... There's not a place to launch boats."

Environmental risks

The Refugio oil spill is a recent reminder of the risk that offshore drilling can bring to shore. In 2015, the Plains All-American pipeline near Refugio State Beach ruptured, releasing more than 100,000 gallons of oil, "much of which ran down a storm drain and into a ravine under the freeway, entering the ocean," according to NOAA.

Photo By Jayson Mellom
SIGN OF THE TIMES An activist holds up a sing at a recent anti-oil drilling press conference detailing what he believes to be the current fight in SLO County: the Phillips 66 rail spur, a petition to ban fracking, and resistance to offshore oil drilling.

"Field teams documented dead fish, invertebrates, and other wildlife in the oiled areas following the spill," NOAA stated in its damage assessment. "The spill also shut down fisheries, closed multiple beaches, and impacted recreational uses such as camping, non-commercial fishing, and beach visits."

That pipeline was a lifeline for offshore oil facilities near the Santa Barbara County coast, and it has yet to reopen, partially causing one company to file for bankruptcy in 2017. Venoco LLC, which operated offshore oil rigs near Santa Barbara and Ventura counties, quitclaimed three state leases in April 2017 and five federal leases in January 2018. One of the state leases had been continually producing oil and gas since 1949.

Venoco referred New Times' questions to an individual outside of the company who handled public relations. That person didn't return a request for comment.

The company issued a statement in 2017 saying that a large factor in Venoco's bankruptcy was the closing of the Plains-All American pipeline, which Venoco used to move oil from its offshore facilities into Santa Barbara County. With the pipeline still out of service, Venoco's Platform Holly has been idle since 2015.

The platforms that Venoco operated in both state and federal waters are currently in the process of being decommissioned, meaning the wells will get plugged and the platforms will most likely be dismantled. But Venoco won't be paying for any of it.

Earlier this year, state officials asked lawmakers to consider spending $100 million in taxpayer dollars to dismantle two operations—Venoco's and Rincon Island, whose operator filed for bankruptcy last year after being charged with multiple safety and environmental violations. Sheri Pemberton, a spokesperson with the State Lands Commission, said the agency is currently negotiating an agreement with ExxonMobil, which held the state leases prior to Venoco, to plug and abandon 32 wells and decommission Platform Holly and the Ellwood Onshore Oil Facility.

According to the commission, Venoco had generated $160 million in state revenue from royalties and rent since 1997. Shuttering its state operations is expected to cost at least $58 million in the short run. Pemberton said that dismantling Venoco's federal operations, Platforms Gail and Grace, is estimated to cost $147 million, which Chevron has agreed to pay for.

How long will all of that take?

"It's hard to say, but many years," Pemberton said.

Formal opposition

Measure A has so far done what it was intended to do. Shell Oil, which owned a federal drilling lease off the SLO coast in the '80s, eventually let the lease fall back to the Department of the Interior. The northern section of the Santa Maria-Partington Basin is still relatively unexplored when it comes to oil and gas, and the industry experts that New Times spoke with said they haven't really heard of anyone interested in drilling off SLO County's coastline.

Romero from BOEM's Pacific Region said that most of the oil and gas interest so far has been focused on the Gulf of Mexico.

Bob Poole, the director of production, state, and coastal issues for the Western States Petroleum Association, said he hadn't heard of any interest either, but that even if oil companies did want to pursue and develop federal leases in the Pacific, "The regulatory dynamic involves everybody—federal, state, and local."

The goal for at least one elected Central Coast official is to insert the state even further into those regulations. State Sen. Hannah-Beth Jackson (D-Santa Barbara) proposed legislation in January that would prohibit the State Lands Commission from approving any new leases for pipelines, piers, wharves, or other infrastructure needed to support new federal oil and gas development within its jurisdiction. The commission has authority over anything in state waters, which stretches between the mean tide line onshore to 3 miles offshore. New Times was unable to reach Jackson before press time.

"California's economy thrives because of our environmental protections. The Trump administration's reckless decision to open these waters to further oil development represents a step backward into the outdated, dirty, and destructive energy policies of the past," Jackson said in a statement sent out on Jan. 4.

Photo By Jayson Mellom
BAN IT Petitioners used U.S. Rep. Salud Carbajal's Feb. 13 press conference against offshore oil drilling as the place to kick off their ballot initiative to ban new oil wells, hydraulic fracturing, and other intense oil extraction techniques.

State Assemblyman Jordan Cunningham (R-San Luis Obispo) doesn't quite see things as Jackson does. He hasn't taken a position on the senator's bill yet, but he did say it's going to be tough for him to support it because it would also ban new infrastructure or lease renewals for already existing offshore operations.

"If it is amended to only extend a moratorium on new leases, I'd probably look at it more favorably," Cunningham told New Times, adding that existing offshore facilities that are producing oil with good environmental track records should continue operating. "I'm not in any way anti-oil. I think we need an all-of-the-above oil strategy. I think as a nation we need to pursue energy independence."

Cunningham co-authored an Assembly Joint Resolution that asks the Department of the Interior to give California the Florida exemption. The Southern state was initially included in BOEM's 2019-2024 draft proposal for offshore lease sales, but after pleas from state officials, Florida's coastline is supposedly getting dropped from the plan. As of March 6, the resolution had passed out of the Assembly and was waiting for a vote in the Senate.

"We have a lot of coastal tourism, we have a lot of commercial activities ... I think the case for California to get the same treatment that Florida got by the federal government is very, very strong," Cunningham said. "The risk with offshore drilling is very real and present, and you can't really deny it."

Those risks are something that the public has spoken to the SLO County Board of Supervisors about at every meeting since Feb. 8. With Supervisor Hill back on the dais March 6, he proposed that county staff prepare a resolution for the county to join 33 other coastal California communities in strong opposition to BOEM's draft proposal.

The resolution would be too late to make the five-year plan's official comment period, which ends March 9. Still, the board voted to agendize a discussion for April.

Hill said that depending on Measure A, which is more than 25 years old, and penning letters to public officials here and there simply isn't good enough.

"I think it's pretty clear that we have not joined the other coastal communities in protesting any plans to drill off our coast," Hill said at the meeting. "I couldn't think of anything more damaging to our local economy than to see offshore drilling and the hazards it brings." Δ

Reach Editor Camillia Lanham at clanham@newtimesslo.com.