After waging often disappointing uphill battles the last four years against remote government agencies that ostensibly closely regulate oil drilling, long suffering residents adjacent to the Inglewood Oil Field gained a plump measure of revenge this afternoon.
One of their favorite targets of searing, but not necessarily meaningful, criticism meekly absorbed an old-fashioned whipping when a state Assembly committee convened an unusual afternoon-long public hearing at City Hall.
Testimony was given centrally by City Councilman Andy Weissman (whose complete presentation is below), Ken Kutcher and John Kuechle, Culver Crest residents and attorneys who have been leading the long slog for more serious regulation and monitoring, and Lark Galloway-Gilliam of the Community Health Councils, another muscular participant.
Sacramento legislators came to town to learn about the public health and environmental impacts of oil drilling on Greater Culver City residents — and the politicians’ ears will be ringing until their next showdown with residents.
The entrée on the menu was a repeated and unrelieved lambasting of the Sacramento agency commonly known as DOGGR, the Dept. of Conservation, Division of Oil, Gas and Geothermal Resources.
DOGGR is charged with authorizing and supervising drilling throughout the state.
Ever since a middle-of-the-night gas leak invaded Culver Crest in January of 2006 and ignited a citizens’ revolt that still is humming at full speed, DOGGR has been popularly cast by frustrated residents and their lawyers as a swashbuckling agency of bureaucrats plagued by a cavalier and highly partisan attitude.
DOGGR’s perceived failing has been constantly ceding too much freedom to a single oil drilling company, Plains Exploration & Production Co., PXP, abetted by a blend of charged in-house laxness and chumminess with the industry in general, but especially PXP. (In the past 18 months, the accusations eventually led to a shakeup, housecleaning and presumably a renewed dedication to tighter oversight.)
This afternoon, they were battered like a pinata by the outspoken Chair of the Assembly Committee on Environmental Safety and Toxic Materials, Pedro Nava (D-Santa Barbara), and more colorfully by numerous officials who testified before the traveling group.
If this was not terribly surprising, the weakness of DOGGR’s defense was.
Instead of robustly denying the numerous charges of overt partisanship toward the oil industry and sloppiness of regulation, Bridgett Luther, the softly spoken director, maintained that her agency’s authority is considerably narrower than suspected and is noticeably underfunded.
After identifying herself as a whistleblower who helped bring down the generation of fallen leaders, Ms. Luther said the new team has resolved to place an increased emphasis on regulation enforcement and is on call every hour of every day.
Mr. Nava, whose committee leaders have two other communities on their itinerary, Hermosa Beach (two weeks ago) and Carpinteria, gave an impressive performance at the well-attended hearing in Council Chambers.
Keeping in mind that he is a lagging candidate in the crowded Democratic race for state Attorney General, he displayed knowledge of and commitment to the cause of drilling-adjacent families worried about hazards to their health.
Whether his zeal will be translated into pragmatic legislation that will be more closely monitored than the present rules, is a question for the future.
Here is Mr. Weissman’s presentation:
My name is Andrew Weissman. I am a member of the City Council for the City of Culver City and for the past year, had the honor of serving as Mayor of the City until my term expired on April 26. I had the privilege of addressing the Chair and Vice Chair in Hermosa Beach on April 30, and I want to thank you for coming to Culver City to hear what we, the city, our constituents, and other interested parties have to say regarding oil drilling in an urban environment.
We greatly appreciate having the opportunity to speak to you.
The Baldwin Hills Oil Field encompasses about 1,000 acres. The Baldwin Hills Oil Field has been operating for many years. Plains Exploration & Production Co., or PXP, took over operation of the Oil Field several years ago.
About 90 percent of the Oil Field is in unincorporated Los Angeles County, much of it abutting Culver City, including several of our residential neighborhoods and city parks. The remaining 10 percent of the Oil Field actually lies within Culver City limits.
As a result, Culver City has been active, not only in the regulation of the Oil Field within its own boundaries, but also active in ensuring that the County’s regulation of the Oil Field is protective of our community and the environment.
I will discuss our involvement in both, beginning with the County’s regulation of the Oil Field.
County Regulation of the Baldwin Hills Oil Field
Commencing in about 2005, there was a significant increase in the number of wells being drilled in the County portion of the Oil Field.
Our residents complained of the noise and odors from those operations.
In January 2006, while drilling several thousand feet below the surface, PXP apparently hit a pressurized pocket of gas that spewed drilling muds and gases to the surface, forcing residents who were overcome by noxious fumes to leave their homes out of fear of their health and safety. The noxious odors and fumes triggered numerous complaints, not only in the adjacent residential neighborhoods, but from as far away as two miles.
Some residents complained of a “rotten egg” smell, indicative of hydrogen sulfide–a toxic and potentially lethal gas. The January 2006 incident was followed by a similar incident just a few weeks later. As we investigated the incidents, we learned that PXP was embarking upon one of the most extensive drilling programs anywhere in the state, in the middle of a densely populated urban residential environment, without the review of potential environmental impacts that is required by the California Environmental Quality Act, known as “CEQA”.
Stunningly, we also learned that Los Angeles County’s antiquated zoning code required no permits for drilling oil. California’s Division of Oil, Gas, and Geothermal Resources (known as “DOGGR”) does require drilling permits. But DOGGR issued drilling permits to PXP without the required review under CEQA. We urged DOGGR to cease issuing permits without the appropriate CEQA review, which DOGGR ultimately agreed to do.
The city met with the County and urged the County to take responsibility to ensure that these extensive drilling operations in the middle of our community be properly regulated and adhere to the same environmental requirements that every other project must follow under CEQA.
We could not understand why a neighborhood shopping mall would be required to prepare an Environmental Impact Report, yet no EIR was required for the drilling of oil wells within a few hundred feet of residential neighborhoods, schools and parks — particularly when such drilling had already caused harm to the public health and safety.
The County eventually imposed a moratorium on new drilling while creating a zoning overlay district known as a Community Standards District. The County developed new oil and gas regulations under an ordinance, which I will refer to as the CSD Ordinance or CSD. The County prepared an EIR for the CSD that ostensibly looked at the potential impacts from the hundreds of new wells and other operations.
Unfortunately, while Culver City really helped start that process, we were not included in it. The County did not consult with the city in the preparation of the EIR nor its CSD.
After many hearings and revisions of the CSD Ordinance, the County approved the CSD and EIR over the objections of Culver City and community and environmental groups.
While the CSD improved the oil field regulations in many respects, we believe it failed to include what was necessary to protect the environment and human health and safety, in part because the EIR itself fell far short of accurately identifying the environmental impacts from the project and how to mitigate those risks.
In light of the tragedy in the Gulf, our concerns are certainly well founded.
To protect the health and safety of the community, Culver City determined it had no choice but to file a lawsuit to challenge the approval of the CSD and EIR and send the EIR back to the County so that the EIR and CSD could be done right.
Culver City was joined by a number of community groups and citizens including: Concerned Citizens of South Central Los Angeles, Community Health Councils, Inc., Natural Resources Defense Council, Mark Salkin and Citizens’ Coalition for a Safe Community.
Shortly after the County approved the CSD and EIR, Mark Ridley Thomas was elected as the County Supervisor for the Second District, which includes the Baldwin Hills Oil Field.
Unlike his predecessor, Supervisor Ridley Thomas recognized the CSD’s shortcomings. Supervisor Ridley Thomas requested, and the entire Board agreed, to take another look at the CSD Ordinance and how it can be more protective of human health, safety and the environment.
We continue to be hopeful that revisions to the CSD will be forthcoming, but in the absence of any resolution, we had to persevere with the litigation. PXP has been very aggressive in the CSD litigation, at great costs to the city.
Indeed, PXP vigorously sought to have the case dismissed without a hearing on the merits. The Court rejected PXP’s efforts and the case is now set for trial on June 3, 2010.
Some of the issues that we are challenging include the following:
1. The CSD does not provide for any environmental review of any future oil well drilling. Rather, the way the Country structured the CSD Ordinance, the approval of the CSD itself constitutes the one and only County approval for hundreds of new wells for decades to come.
2. The EIR failed to consider air quality impacts from future drilling operations on the flawed theory that it would not be worse than the emissions from the significantly increased drilling operations in 2005 and 2006 that were not subjected to any environmental review or mitigation under CEQA.
3. The CSD Ordinance allows drilling operations to increase noise levels in residential neighborhoods that exceed those allowed in commercial areas and even construction areas.
4. The EIR failed to meaningfully consider directional or slant drilling – a conventional and well-used technology – as an alternative to drilling within a stone’s throw of residential neighborhoods.
5. The EIR predicted that the risk of an oil spill reaching a waterway could only occur once every 5,200 years but failed to adequately address, much less recognize, that such a spill was not only much more likely to occur, but actually did occur in March 2008 during the preparation of the EIR. In March 2008, there was a spill from a pipeline, which flowed into the storm drains leading into Ballona Creek.
6. The EIR predicted an increased cancer risk, above and beyond that from current operations, of nearly 10 in 1 million residents. But the EIR concluded, without any justification, that such a risk was so “insignificant” that it did not require mitigation.
7. The County Board of Supervisors found that 167,000 tons of new greenhouse gas emissions that the increased operations at the Oil Field will generate was “insignificant” and need not be mitigated. That’s 167,000 tons. This is the equivalent of about 40,000 new cars on the road every year. By way of comparison, the California Air Resources Board has proposed that 7,000 tons of greenhouse gas emissions, about 4 percent of the projected emissions from the oil field, be considered significant for purposes of CEQA and subject to feasible mitigation.
Importantly, we should note that the parties are now engaged in settlement discussions.
Supervisor Ridley Thomas has been very active in spearheading these settlement discussions. The California Attorney General’s office has acted as a mediator given the important public interests at stake. The city is very confident in the merits of its legal position, but believes that a negotiated settlement, one that adequately addresses the city’s health and safety concerns, presents the opportunity for a better outcome for all the parties. We are hopeful that this process will lead to a constructive resolution of our concerns.
City’s Regulation of Oil Operations Within City Limits
Now, let me address the regulation of oil operations within the City’s own jurisdiction. Before all of the controversy arose over the County portion of the Oil Field, the city had begun to look at its own ordinance regulating oil and gas operations.
We recognized that it needed to be updated. The city has about 25 operating wells within its city limits. No new wells have been drilled here since 2002. In late 2005, we began the process of revising the ordinance and sought to work collaboratively with PXP to do so. However, with the events in 2006 resulting in the release of noxious gases to our neighborhoods, we realized there was much we did not know about the environmental and public health risks of oil drilling. Consequently, we suspended our own efforts to allow the County’s process of developing the CSD Ordinance to proceed. We had hoped that the City could learn more about the environmental risks through the County’s environmental review, and the resulting EIR, and model our ordinance on the ordinance adopted by the County, so that there would be consistent, safe and protective regulations throughout the Baldwin Hills Oil Field.
We hired a consultant experienced in oil and gas operations to help us with the process and to identify and address the risks and issues unique to Culver City.
However, in the middle of the litigation over the CSD, before Culver City completed its analysis, much less promulgated a revised drilling ordinance, PXP obtained drilling permits from DOGGR to drill three new wells in Culver City, near Culver City Park.
To say the least, this caught us by surprise. Our ordinance had not been revised and PXP was seeking approvals to drill three new wells in Culver City. We advised DOGGR that any new permits should not be issued without the appropriate review under CEQA, which the City would undertake as a lead agency. Inexplicably, DOGGR issued the drilling permits anyway.
The County’s EIR had identified a number of major environmental, public, health and safety concerns that had to be addressed and mitigated and we had no ordinance in place to address such risks, or to even require the limited and we believed, inadequate mitigation recommended in the County’s EIR.
It is important to keep in mind that the County’s EIR specifically addressed the County’s CSD. As Culver City is an incorporated city, the County’s EIR was not controlling with respect to operations within Culver City.
To allow the city time to develop our new regulations, which could include a change to our zoning regulations, we promptly adopted a moratorium under California Government Code section 65858. Just as promptly, PXP sued the city to lift the moratorium. PXP took the position that the city could not limit new oil drilling on land where PXP already had wells,because PXP claimed to have a vested right to drill new wells, as many as it wanted.
Under PXP’s theory, once a city allows land to be used for one well, a city has no right to limit or regulate the drilling of new wells. After a trial on the merits, Judge Chalfant of the Los Angeles Superior Court correctly rejected PXP’s vested rights claim and the other arguments it asserted.
Wc did not have the discretion to condition drilling permits because of its vested rights, an argument which the Court has now rejected.
Lessons Learned
The Court’s rejection of PXP’s misplaced vested rights claims in our case is important. PXP made similar vested rights arguments to the County as leverage to gain a more favorable CSD Ordinance. And we believe the arguments had an effect. We believe the County felt constrained in its ability to regulate the drilling of new wells because of PXP’s arguments that it had vested rights that it would sue to enforce. We trust that the County will take note of Judge Chalfant’s decision as it looks to make the CSD more protective of the public and the environment.
When we discuss local oversight of oil operations, the risk of expensive litigation by deep-pocketed oil companies is the elephant in the room.
For cash-strapped municipalities, such litigation can be crippling. In our case, we felt that the public health and safety concerns had to be protected.
In light of recent events, those concerns cannot be overstated.
We stood our ground and the Court vindicated our position. Other municipalities or counties may not choose to do so, and while regrettable, it is understandable. Cities like ours,with limited resources, are left to protect important public interests in public health, safety and the environment. But the threat and cost of litigation may force cities to choose between protecting these important interests and having enough funds to provide the essential public services that we do. You have asked us to provide suggestions on how the state may assist local entities in providing better oversight and regulation of oil drilling operations. We respectfully offer the following suggestions:
1. We propose that California undertake a comprehensive study of the environmental, health and safety risks from drilling wells in urban and suburban environments. For example, we need to understand the risks of long-term exposure to low levels of hydrogen sulfide emissions from petroleum operations.
It is asking too much to ask local agencies to fully study, understand and assess these complex technological issues with the limited resources at their disposal.
This state study will assist local agencies in their local land use and regulatory decisions And in the preparation of their own environmental documentation of the local risks under CEQA.
The state study should also look at the technology involved in oil drilling, particularly the feasibility of established, new and developing technology in mitigating environmental risks, such as directional drilling, such as directional drilling, electrified drilling rigs and the like.
2. We have a very substantial oil field operating next to hundreds of thousands of people, and no one has tried to assess or monitor the actual toxic emissions from the field. We know there is hydrogen sulfide, benzene and diesel particulate emissions, we just don’t know how much.
Using computer models that rely on questionable assumptions and data is not the answer. We need on the ground air sampling.
The oil field operator, under the oversight of the South Coast Air Quality Management District, should be required to fund or perform source and borderline monitoring of toxic emissions.
Alternatively, funding should be provided so that the Air District can perform the monitoring. 3. DOGGR, as the state agency most directly responsible for regulation and permitting of oil production facilities, mnust consider the potential environmental impacts of oil operations under CEQA. In the absence of another lead agency, DOGGR must take the lead agency status and discharge its obligations vigorously.
As a responsible agency, it should fully participate in the process and lend its considerable expertise to assuring that potential environmental impacts are understood and mitigated.
In the Baldwin Hills Oil Field, for example, significant questions have been raised regarding the safety of hydraulic fracturing, or fracking.
But these questions have not been addressed or resolved by DOGGR.
When it comes to subsurface hazards such as this, Los Angeles County has deferred to DOGGR to address and regulate such hazards.
Unless DOGGR acts to aggressively address and regulate those risks, the city and its residents are left with the fear that “fracking” may cause harm to their homes and property.
Too often, DOGGR fails to undertake any CEQA review at all without explanation or justification. DOGGR should work collaboratively with the jurisdictions in which permits are being considered, so that permits are not issued prematurely, before the full environmental analysis is complete.
4. We propose that the state legislatively clarify that the so-called “diminishing asset” doctrine clearly does not apply to petroleum extraction.
The “diminishing asset” doctrine has been exclusively applied to quarrying operations to create a vested right in mining the entire property.
Yet, PXP has asserted that it should also apply to petroleum, creating a “vested” right to drill as many wells as they want without condition.
While the argument is absurd, the city was forced to spend a good deal of money to establish the nonsense of it in Court.
And we can expect that PXP will force us to do the same before the Court of Appeal.
A legislative clarification would put an end to the absurdity.
5. Drilling rigs should be regulated by local agencies, just like any other stationary source. Currently portable rigs, and almost all are portable, are only regulated by the State. The result is that drill rigs operating in the South Coast basin, with all of our air quality problems are governed by the same regulations that apply to drill rigs operating in remote rural counties.
We believe this is both unwise and inappropriate.
We would welcome action on the part of the legislature in this area.
Thank you for the opportunity to present this testimony on behalf of Culver City.
