Community activists and residents today joined with local water agency leaders to announce the filing of a lawsuit to compel a Texas-based oil company, Tesoro Corp., to pay its water bill like everyone else and become a good corporate neighbor.
Tesoro – which had $30 billion in revenues last year and is a Fortune 150 company – now owes the Water Replenishment District/WRD $690,000 for water Tesoro uses at its Wilmington refinery. The Replenishment District is the public water agency that manages groundwater supplies for 3.8 million Los Angeles County residents in 43 cities.
In its petition for a preliminary injunction against Tesoro, the Water Replenishment District demanded Tesoro immediately stop pumping water until it has settled its delinquent bill with the District. The $690,000 bill includes unpaid assessments and interest.
The District warned the courts that Tesoro’s refusal to pay “poses an incipient threat to the quantity and quality of groundwaters within the [Central and West] Basins.” Tesoro’s pumping threatens to handicap the District’s ability to provide “new” water to replace that being withdrawn by Tesoro from the West Basin. If Tesoro’s conduct were to go unchecked for too long, it could cause the infiltration and contamination of south L.A. County’s groundwater by non-potable seawater, according to the District’s water engineers and scientists.
No Excuses Accepted
“In sum, there is simply no justification, legal or otherwise, for Tesoro to take the law into its own hands and stop paying the RA [replenishment assessment], while continuing to pump groundwater for free,” according to the District’s lawsuit, filed in Los Angeles Superior Court.
“Tesoro is engaging in behavior you’d expect from a bully, a bad neighbor and a freeloader,” warned Albert Robles, Water Replenishment District president. “It’s simply irresponsible to refuse to pay for water you need for your own business operations while jeopardizing the region’s groundwater supply for millions of Southern California residents.”
“We came here to the Tesoro refinery to make sure Tesoro gets an earful,” said Long Beach resident Brett Gallo, who also participated in today’s news conference outside the Tesoro plant. “We shouldn’t have to give free water to an oil company with $30 billion in revenues last year while we’re paying the highest price in history for every drop of gasoline it sells to us.”
Even as its perceived irresponsible conducts hurts its neighbors, Tesoro is seeking Federal Trade Commission approval to purchase the British Petroleum/BP refinery in nearby Carson. If approved, that purchase would make Tesoro the second largest refiner in the state, giving it immense power over the gasoline prices paid by motorists.
Month Three of Non-Payment
“If Tesoro can’t be trusted to act responsibly in its dealings with a public water agency trying to keep water rates affordable to residents, then how can we trust them to act responsibly if they gain virtual monopoly control over the gas prices California motorists pay,” said Mr. Gallo. “Until Tesoro pays its bills like the Replenishment District’s other customers and proves it can be a good corporate neighbor in south L.A. County, we will fight their request for FTC approval of their BP transaction.”
The Replenishment District has learned first-hand that Tesoro is engaging in practices that could give Big Oil a bad name. Tesoro is entering its third month of refusing to pay its District water bills as it attempts to strong arm the District into granting it (the oil company) a bigger share of groundwater storage rights.
“What we’ve got here is a billion-dollar, out-of-state oil company bullying the District’s 3.8 million water users to fatten its bottom-line,” said Mr. Gallo. “Tesoro values and needs our inexpensive water for its operations, and they want a bigger share of it. Tesoro thinks it doesn’t have to play by the rules. It is exerting financial pressure on the District and its customers to get what it wants.”
Tesoro’s proposed purchase of BP’s plant would triple its groundwater rights in the region, granting it approximately 25 percent of the groundwater. Because Tesoro has stopped paying its water bills on its Wilmington refinery while continuing to pump water, the Replenishment District must assume Tesoro will do the same if it acquires the BP site. Unless this conduct is stopped, it could trigger higher water rates for other District customers.
Mr. Robles and Mr. Gallo said the anti-Tesoro coalition will also urge state state Atty. Gen. Kamala Harris to investigate the proposed Tesoro-BP deal. “In the past, when he was attorney general, Jerry Brown made no bones that he wasn’t going to let Big Oil trample on the consumers of this state, and we are confident Kamala Harris will follow in Brown’s footsteps,” Mr. Robles said.
For complicated reasons – mostly designed to protect the safety of the District’s groundwater resources – the District cannot simply shut off Tesoro’s water when it doesn’t pay its bills.
Mr. Schwada may be contacted at John.schwada@gmail.com
