Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

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Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities
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Oil platforms off Santa Barbara coast (file photo)

Source: Office of Sen. Jackson

As the state works to combat climate change and move toward a fossil fuel-free future, Governor Gavin Newsom recently signed Senator Hannah-Beth Jackson (D-Santa Barbara)’s legislation to assess the eventual price tag of shutting down and cleaning up California’s oil and gas infrastructure.

Senate Bill 551 directs the Division of Oil, Gas and Geothermal Resources (DOGGR) to develop a process for assessing the costs of decommissioning all oil and gas infrastructure within its jurisdiction, and requires operators of an oil or gas facility to report its total liability for plugging and abandoning all wells and other facilities beginning in July 1, 2022 and at least every five years thereafter.

“I am very pleased Governor Newsom signed this bill into law, recognizing it as a key step in the planning process as we transition away from fossil fuels. If we do not know or fully plan for these costs, the public, in far too many instances, will be left unfairly holding the bag for this industry’s mess,” said Jackson.

Over the next several decades, California will face the significant challenge of infrastructure that remains from oil and gas production.  While oil and gas operators are required to bear the ultimate financial responsibility for shutting down their wells, removing infrastructure, and remediating sites, in several cases they are refusing to do so, leaving California taxpayers paying the costs.

One example of California state funds used to decommission oil and gas wells can be found in the offshore production off the Santa Barbara coast.

The decommissioning of Platform Holly, initiated in 2017 as a result of the 2015 Refugio oil spill and subsequent bankruptcy of oil operator Venoco, is currently estimated to cost upwards of $180 million. Similarly, the state now bears responsibility for shutting down Rincon Island, an artificial offshore structure formerly owned by a now-defunct and bankrupt operator. Estimated costs to the state are more than $50 million.

This legislation is part of Jackson’s long-standing efforts to address the fiscal and environmental impacts of oil and gas production in California. Her prior legislation includes:

  • Senate Bill 834, which became law on January 1, 2019, blocks the Trump Administration from expanding federal oil drilling off the California coast by ensuring that new pipelines and other infrastructure needed to support federal oil development cannot be built in California waters.
  • Senate Bill 44, Coastal Well Cleanup and Remediation Act (2017): Requires the State Lands Commission to monitor and plug orphaned wells when the original oil company that operated the well no longer exists.
  • Senate Bill 414, Rapid Oil Spill Response Act (2015): Authored in the aftermath of the Refugio Oil Spill to make oil spill response faster, more effective, and environmentally friendly.
  • Senate Bill 295 (2015): Helps reduce the risk of oil spills from pipelines by requiring the State Fire Marshall to annually inspect all intrastate pipelines and pipeline operators.

 

 Jackson represents the 19th Senate District, which includes all of Santa Barbara County and western Ventura County.

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turbill1 Oct 18, 2019 10:28 AM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

Shutting down oil production in CA is not the answer. It just means we tanker in more foreign oil which increasingly the threatens our coastline with oil spill disaster. If you are really serious about stopping fossil fuel usage, you will have to work to close gas stations. There should be one close to you that you can picket until it closes.

Z Oct 18, 2019 10:45 AM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

Read the article TURBILL1. The bill calls for oil producers to account for the costs of decommissioning their facilities when they shut down. We keep getting stuck with the bills when they abandon wells, pipelines and other infrastructure. It doesn't call for shutting down oil production in California, just some financial responsibility.

macpuzl Oct 15, 2019 03:47 PM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

You can look here: ===================================================================== https://revenuedata.doi.gov/explore/CA/ ===================================================================== For Santa Barbara County, it's pretty negligible.

a-1573747963 Oct 15, 2019 02:45 PM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

We have a rich diversity of thought and ideas in the comments here, and I really enjoy the discourse. I would encourage everyone to share ideas, be thought provoking, and most importantly be kind and tolerant of others. Yes, conservatives are in the minority in California, and especially in the SB area. However, there are far more of them around than you might think. You won't see bumper stickers on their cars or signs in their yards, because they fear being attacked by intolerant authoritarian personality types. I read Altemeyer's book. His personality test questions are all skewed to target conservatives. There is absolutely such a thing as "liberal" authoritarianism, and it is on full display in some of the comments in this thread. I would invite all my liberal friends to take a moment to contemplate what it is like to be "conservative" in SB. Imagine you are taking a college class and you are excited about an essay topic, but you can't write what you really believe because your professor made you fear your grades would suffer if you did. Imagine you are at work and your bosses and co-workers make a bunch of smug and offensive remarks about how much they hate your preferred political candidate and her supporters. You are afraid to speak up and say what you believe because you know doing so could cost you your career. Imagine you are out with your friends, and they all arrogantly describe how uneducated everyone who agree with you about a hot topic in the news is. You are afraid to speak up and say what you believe for fear of being ostracized from your social circles and slapped with hurtful slurs. That it what life is like for many minorities in our community. Next time you express your political beliefs, please remember that some of your colleagues are closeted conservatives. By all means express yourself, but remember to be tolerant of those who see things differently. Open your heart, try to understand why they feel the way they do, and let them know that you will still love them even if they are conservative. Once you earn their trust, you will find that many people you love and respect are closeted conservatives. You will also be surprised to lean you have a lot more in common with conservatives than you think. We all live under the same sun and we all walk under the same moon. Perhaps you will even find merit in some so-called "conservative" ideas. Through love and tolerance we can strengthen our friendships, gain new perspectives, and build a stronger community. Love and tolerance is the answer!!!

Alexblue Oct 16, 2019 07:46 AM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

2:45--dude I see Trump stickers on cars regularly in SB and even more throughout the County, I see "Lock her up" stickers, "Don't tread on me" stickers, "Gun control means using both hands" stickers, ad nauseam ad infinitum. There's a particular flavor or conservative, i.e., you, that has become whiny and victim claiming. Oh, poor me, people may not AGREE with me. And snowflake libs need a safe space? Come on.

a-1573747963 Oct 15, 2019 05:38 PM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

Oh, please. My neighbors are conservatives and you never saw such a bunch of arrogant, entitled jerks. All they care about is their image, their money, not paying taxes and their "right" to trample all over everyone else's rights. One quote that so aptly fits conservatives is: "It's funny that people who treat you like s--t get offended when you finally do the same to them." That fits my neighbors to a 'T.' You want me to feel sorry for people who can't think of anything other than themselves? That'll be a cold day you know where.

Chip of SB Oct 15, 2019 03:18 PM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

That is classic authoritarianism. "What I believe is fact, I am righteous, those who disagree deserve to suffer." If what you believe is always a "fact" and what others believe is always "contrary to fact," it may be time to stop and say "hey, are you sure we're not the baddies?" The world is not always black and white.

a-1573747963 Oct 15, 2019 02:56 PM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

2:45 - HAHAHAHAHA. That's hilarious! Poor conservatives...all those liberal "snowflakes," "sissies," "libtards," "whiners," "femi-nazis," "commies," "hippies," etc etc etc, are being so mean. You're right. Let's stop the insults. HAHAHAHA.

BlueHorseshoe Oct 15, 2019 10:24 AM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

It may just be me, but it seems like the Edhat rants in the comments section is beginning to lean further and further Right, bravo! About time we enlist the closet republicans to actually talk about the issues from a logical and financial standpoint. It got really old listening to the cheerleading of financially defunct propositions and acts that promote the handouts instead of moving the state forward. Now, as for the oil & gas industry. I question how the state plans to promote less oil & gas when their policy against the current power companies is to allow them to shut down millions of customers for 5-7 days, pushing everybody to go buy a generator. Seems like the wrong direction and they can't even keep their movements cohesive.

SantaBarbaraObserver Oct 16, 2019 08:04 AM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

LCP112233 I see you are incapable of deciphering the difference between a Rumpster and an actual Conservative. Which only proves my point about fools being played... Its a lack of emotional awareness paired with a low IQ that makes people of the Hannity/Limbaugh/FoxNews cult so dangerous. And for the record: I am not a Democrat nor a liberal but an independent person with the ability to reason without an uneducated talk show host telling me how to think or who to hate... Try it sometime.

Alexblue Oct 15, 2019 01:37 PM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

Oh, you're going to talk about issues from a logical and financial standpoint. That's good. When will you start? Because I'm pretty sure that understanding how much it costs to run a business vs. how much revenue it generates for the State, and considering the long term financial impacts it creates through abandoned wells and air, ground and water pollution is a reasonable and logical way to consider options for the future. So tell me how you disagree with that.

LCP112233 Oct 15, 2019 01:06 PM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

SB Observer: Scathing post. Angry much? This conservative has her own business in the form of a Corporation and work 6+ days a week. Yeah. Bad bad. Looks like you are the only one that has time to to rant about how awful others are in an extended post.

SantaBarbaraObserver Oct 15, 2019 12:43 PM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

Unfortunately, the most hardcore "conservatives" among us sit on their computers/tablets/phones all day, listening to talk radio and filling their tiny minds with other people's rage. They are unemployed / underemployed / semi-retired who have no life so-to-speak; no social life, no activities and not much in terms of intellectual curiosity to satisfy. So they appear to be more prolific because they have time to post here. Most sane, intelligent, educated and productive people are too busy living and working towards their future to bother parroting their favorite talk show Charlatan on the Internets. It really does appear that many Rumpsters are online all day long, with their copypasta close at hand parroting the same Limbaugh, Hannity talking points. At least the ones I know and see... Coincidence or just a reminder that the loudest voices do not represent the opinions of the whole?

macpuzl Oct 15, 2019 12:21 PM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

Most climate science deniers are diehard conservatives. Conservatives are predisposed to be xenophobic, more religious, more repressive of women’s rights, with little concern for fairness or equity, and to hold a pessimistic view of human nature. They are much less open to new experiences of any type, and are much more prone to authoritarianism and to group think. This is the opposite of scientific thought. Staunch conservatives are the least capable of thinking critically and rationally about anything that comes into conflict with their ideology. Conservatives correctly recognize that if anthropogenic global warming is true, then governments need to play a leading role in dealing with the issues. Major governments of the world will have to collaborate to solve the problem. That is totally anathema to the "greed is good" free market capitalist belief system. Therefore, anthropogenic global warming cannot be true in their view, and is rationalized as a hoax, despite the overwhelming scientific evidence to the contrary.

KE6HTS Oct 15, 2019 08:37 AM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

Ignorance is bliss for some people.. or the people indoctrinated in California schools and universities. The first question is prove the need to reduce/eliminate fossil fuels with facts rather than dogma. Naturally, the people supporting this ill thought out legislation don't have the education to answer this question. They do have the indoctrination though :(.

PitMix Oct 16, 2019 08:35 AM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

This is not true. CA state taxes total about 55 cents/gal. Federal is another 18 cents. For your statement to be true, we would have to be paying less than $1.56/gal. Can you let me know where you are getting this cheap gas? Did you know you were posting something untrue or do you just not care?

macpuzl Oct 15, 2019 01:28 PM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

But the taxes are an attempt to rectify the huge hidden subsidies that prop up big oil, not only in overt subsidies, but in the form of letting them skate for all the environmental damage they do. We need to at least double those taxes to reflect the true cost to society.

a-1573747963 Oct 15, 2019 07:20 AM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

Why is this bill not "how to retrofit all roofs with solar"? Shouldn't it be sourcing replacement energy? Not that solar would make a huge dent, but it's there, available. What was that you say? Too expensive? You mean more expensive than a bunch of bean counters pandering to a nutty politician while pretending to count something they never intend to do? Oh. I did not know that.

sea dog Oct 15, 2019 07:48 AM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

Solar is awesome but energy companies are trying to limit what they pay for it. We pay $.15 Kw hr for electricity while the power companies want to pay only $.039 Kw hr for solar power. Some power companies are also starting a charge for using their power lines. As many people found out recently, solar does not keep the lights on during a blackout w/o an expensive and toxic battery. Far from green, solar panel are so toxic that only one toxic waste dump in Ca takes them. Solar panels cost more to throw out than they do to buy. They do last a long time unless you have a hail storm like they recently had in N. Ca. Entire solar panel displays were destroyed along with the roofs they were on !

Shasta Guy Oct 15, 2019 06:57 AM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

Both Norway and Iceland are blessed with geography and geology the enables abundant hydro and hydrothermal electrical production. With their relatively small populations they can produce enormous amounts of renewable energy for themselves. However, most countries cannot be like them, and we shouldn’t compare ourselves to them. If California had the equivalent of say 20 Shasta Dams then we could Possibly be like Norway. Large scale industrial countries (and states like CA) cannot operate on unpredictable renewables like solar and wind. Take a look at what’s happening in Germany with their “Energiewende” or complete transition to renewable energy. Electrical costs are soaring and the risk of grid failure is increasing. Heavy industry can’t function or compete well when those sources of renewable are the majority source. Let’s see how the slow German economic suicide runs its course and if California should follow their lead. From Der Spiegel: https://www.spiegel.de/international/germany/german-failure-on-the-road-to-a-renewable-future-a-1266586.html

macpuzl Oct 14, 2019 05:57 PM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

Iceland and Norway already generate all their electricity from renewables, and the United Kingdom is already at 50%. Just think what we could do if we looked to the future and weren't sliding backwards instead, both for the world and for our economy, by investing in new technology.

macpuzl Oct 14, 2019 10:44 PM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

10:16 PM - Yeah, right up there with giants like Luxembourg. Your figures are for the business sector, not households, and is large (in appearance) because of use of fossil fuel for maritime and air transport of goods. It's small in aggregate because the population is small. But we were talking electricity generation in this thread. Both Norway and Iceland generate all of their energy from renewable sources.

a-1573747963 Oct 14, 2019 10:16 PM
Governor Signs Bill to Assess Cost of Shutting Down Oil Facilities

"Iceland Has Highest Per- Capita C02 Emissions in EU and EFTA." (European Free Trade Association) (Iceland Review, 2018). And "Norway is a large energy producer, and one of the world's largest exporters of oil." (Wikipedia)

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