California Oil and Gas Report

The Carson City Council declined to extend a fracking-inspired moratorium on all oil and gas drilling in a vote taken in the early morning hours of Wednesday, April 30th.

The council enacted a 45-day ban on drilling on March 19th, to give the city time to review the alleged safety risks of oil and gas operations, including hydraulic fracturing. The only planned drilling in the city was a proposal by Occidental Petroleum to drill more than 200 wells, none of which would involve fracking.

Continuation of the moratorium would have required a four-fifths supermajority vote by the city council. Only two council members voted to extend the ban. Two others opposed, and one member abstained.

Also discussed at the meeting was the pending lawsuit filed by some Carson residents related to homes built over abandoned oil operations that have been affected by contamination in the soil. Continue reading →

The Western States Petroleum Association (WSPA) on Monday, April 21, released the findings of a new economic study produced by the Los Angeles County Economic Development Corporation (LAEDC) detailing the oil and gas industry’s sizable economic and fiscal impacts on California’s economy.

The 72-page report finds that the industry was responsible for 468,000 California jobs in 2012 (the latest year for which complete data are available), or 2.3% of the state’s employment, and more than $220 billion in direct economic activity, contributing 5.4 percent of ’s state GDP.  Additionally, the industry provides more than $21.6 billion in state and local tax revenues and $14.7 billion in sales and excise taxes.

The LAEDC’s analysis highlighted the petroleum industry’s economic impact throughout California, including tax revenues in all counties. “The oil and gas industry supports 104,000 jobs in Los Angeles County alone,” said Christine Cooper of the LAEDC, “and its activities here generate more than $5 billion in state and local tax revenues.” Continue reading →

Editor’s note: Gary L. Toebben, President and CEO of the Los Angeles Area Chamber of Commerce, provided the following cogent and powerful critique in the Chamber’s blog of the Los Angeles City Council’s vote to halt fracking. I share his view that the Council’s ill-advised decision was based on misinformation and fear, not science.  Dennis Luna, Editor, California Oil and Gas Report.

During the 20th Century, the growth of middle class jobs in Los Angeles and Southern California was fueled by oil, manufacturing and construction. Today, all three of these industries are under attack by new regulations and a not-in-my-back-yard mentality, which together are depleting the number of middle-class jobs in these sectors.

Last Friday, the Los Angeles City Council took another step in this direction by directing the City Attorney to draft a moratorium on hydraulic fracturing (fracking) and other commonly used drilling techniques.

Jobs related to oil drilling are good middle class jobs and are often union, paying an average of $80,000 per year.

Oil drilling standards are set and regulated at the state level and California has the highest drilling standards in the nation. California Senate Bill 4 authored by prominent environmentalist State Sen. Fran Pavley and signed into law in 2013 by Gov. Jerry Brown, further sets out a process to create an even broader set of regulations and protections for our environment, while still allowing our state to take advantage of domestic oil and gas resources that create jobs, generate tax revenue and provide the energy our businesses and residents need. Continue reading →