Fighting Weather Weirdness with Increased Oil Drilling? An Audacious Proposal from Venoco
Thursday, June 25, 2015
CRUDE AND RUDE: Timing isn’t everything, the late, great Vince Lombardi famously never said. It’s the only thing. Someone might mention that to Tim Marquez, the beguiling CEO of the Venoco oil company, headquartered in Carpinteria. By all accounts, Marquez is irresistibly nice and smart and has what the professional spin doctors are fond of calling “a compelling narrative.” According to company lore, Marquez started Venoco back in 1992 in all but the proverbial log cabin, humbly maxing out his credit card for $3,000 to do so. Three years ago — after many convoluted corporate gyrations in between — Marquez took Venoco private. Along the way, he amassed about $1 billion in debt, $400 million of which was spent buying out other shareholders. It didn’t help Venoco’s bottom line that oil prices worldwide tanked almost immediately, prompting the company to make significant layoffs and sell two of its major facilities elsewhere in the state. The oil patch — like old age — ain’t for sissies. All that’s preambulatory explication for Venoco’s big play this week.
This Wednesday marked the first of what will be many environmental hearings for Venoco’s proposal to extend the reach of its oil drilling operations from Platform Holly — located a couple of miles off the coast of Isla Vista by Coal Oil Point — to about 5,000 feet beyond the boundary lines of its current lease. If this project — dubbed with strategic blandness a “Lease Line Adjustment” — is approved, Venoco will expand its proven reserves at Coal Oil Point by 60 million barrels. That’s not chump change. If the State Lands Commission approves this deal, Venoco’s portfolio of proven reserves triples in size overnight.
Venoco quietly initiated this process about a year ago. The first environmental meet-n-greet was initially scheduled for May 26. There was just one hitch. On May 19, the Plains All American Pipeline sprang a major leak at Refugio, and we’ve been perseverating about it ever since. In deference to the raw nerves, high dander, and resurgent anti-oil spirit thus unleashed, the first State Lands meeting was delayed a month until this Wednesday. It wasn’t nearly enough. Environmental activists showed up en masse — some dressed as oil derricks — for a combination open mike, political karaoke, and piñata pummeling at the Goleta Valley Community Center, with Venoco invited to play the role of piñata. It’s difficult to conjure a worse possible time for Venoco to seek approval for such plans. Hard, but not impossible, especially given Venoco’s recent history.
In 2010, Venoco wanted to install 35 new onshore slant-drilling wells — not to mention a 175-foot drilling rig dressed up to look like a Spanish colonial tower — onshore just spitting distance from both City Hall and Carpinteria’s much-beloved seal haul-out and rookery. In a bold, creative, aggressively in-your-face move, Venoco sought to bypass Carpinteria’s sacrosanct planning process by taking its case — via Measure J — directly to city voters. The company asked voters to support massive changes to the city’s zoning and planning bible needed to make such an industrial project conform with the city’s general plan. Under the best of conditions, Venoco was pissing up a very steep rope on a windy day. But conditions were far from ideal. On April 20 — in a galaxy not far enough away — a natural-gas explosion rocked BP’s now infamous Deepwater Horizon production facility in the Gulf of Mexico, killing 11 oil workers, injuring 17 more, and letting loose the worst maritime oil spill in U.S. history. With the BP explosion dominating news coverage, Measure J was toast, and on election night, 70 percent of Carpinteria’s civic-minded voters told Venoco to take a long hike off a short pier.
When history repeats itself, I find it interesting. But what makes Venoco’s current proposal genuinely intriguing — rather than merely operatic — are company claims that by drilling 3,000 feet below the ocean floor into these adjacent reserves, it can reduce the subsurface pressure giving rise to one of the biggest natural seeps in the United States, if not the entire universe. These arguments, it should be noted, get trotted out about every eight years by oil-industry stooges and apologists with an embarrassing penchant for grossly overstating their case. But according to three UCSB geologists with whom I’ve recently communicated — albeit in limited fashion — this theory might actually apply by Platform Holly. The three — professors David Valentine, Bruce Luyendyk, and James Boles — have all studied the connection between Coal Oil Point seep volumes and oil drilling. All three expressed various cautionary quibbles, questions, criticisms, and qualifications but agreed that done correctly — assuming the right subsurface geological conditions — drilling in that area could reduce seep volumes because of the unique geometry of seep beds, oil reservoirs, and earthquake fault lines found near Platform Holly. Based on past experience, the greatest and most reliable reduction has been on the quantity of natural gases released. Less clear and predictable, however, has been the impact of such drilling on the proliferation of big gooey tar gobs.
Giving new and serious urgency to this question is the heightened freak-out factor rightfully attending climate change and attendant weather weirdness. In case you missed it, more than 800 Pakistanis died this week as temperatures hit 113 degrees. According to the Santa Barbara County Air Pollution Control District, oil seeps in the channel release about 24,000 metric tons of methane gas every year, the equivalent, by the way, of 247,000 cows. Given that methane is 25 times more devastating a greenhouse gas than carbon dioxide, that’s 247,000 cows that might matter when it comes to climate change. Whether tripling Venoco’s drillable reserves is the best or only way to contain them, however, is a horse of another color. That argument has yet to play out. But when it does, it could prove genuinely interesting and disturbing.
Regardless, where Venoco is concerned, history has a way of repeating itself. For those of us not paying attention the first time, that’s awfully convenient. For Tim Marquez, I’m not so sure.