Ellwood Oil Facility Closer to Closing?

The City of Goleta released a private consultant’s report this week concluding that the Venoco oil company amortized all the costs it had incurred by purchasing the Ellwood Oil and Gas Facility as of the year 2009. This esoteric tidbit qualifies as a bureaucratic and regulatory banana peel of some significance for the beleaguered oil company and will provide ammunition for those within Goleta’s City Hall who want to shut the oil- and gas-processing plant down.

The Ellwood plant was decreed a legal nonconforming use in 1990 by the County of Santa Barbara, which had rezoned the coastal land in question for recreational uses, but little effort was expended in shutting the plant down. After the City of Goleta incorporated in 2002, interest in closing the plant ​— ​which processes oil and gas pumped from Platform Holly off the Ellwood coast in state waters ​— ​grew. A key consideration throughout was whether the owner ​— ​Venoco Oil ​— ​had been able to recoup its costs over time. The report answered that question in the affirmative. Had the report concluded otherwise, the Goleta City Council would have encountered legal troubles if it attempted to shut the plant down.

Venoco spokesperson Brian Robinson said the company was still evaluating the report but added that the State of California ​— ​to which Venoco pays royalties ​— ​is a partner in the oil and gas facility. Robinson said Venoco had a contract with the State Lands Commission to produce and process oil off the Ellwood Coast. The State Lands Commission, he suggested, might not take kindly to efforts to close Ellwood. Venoco has not been drilling any oil off the coast nor processing any at Ellwood since the Refugio pipeline spill of May 2015, which has idled about half the company’s revenue-generating machinery. The next move is up to Goleta City Hall, which has to figure out how much it wants to tangle with a wounded oil company.