State Lands Commission Denies PXP Offshore Oil Drilling Proposal

• Panel Votes 2–1 against EDC-Brokered Package •

BY ANNE SOBLE

Despite a hearing room packed with Santa Barbara supporters, most of whom focused on local budgetary need instead of environmental impact, the California States Land Commission voted 2–1 Thursday to oppose a proposal for two offshore subsurface oil leases that would have allowed Plains Exploration and Production, known as PXP, to slant drill 17 new oil wells in state tidelands from a federal platform currently in operation.

The proposal, the Tranquillon Ridge Oil and Gas Project, was brokered by the Environmental Defense Center for two private Santa Barbara civic groups. EDC chief counsel Linda Krop described the package that would have provided land donations and funding grants to the immediate area as "an air-tight agreement" that would provide important benefits and "end oil drilling," even as she said its drafting was "a long, strange trip."

Others in the room were not convinced. Much of the hearing held in Santa Barbara took on the air of a semantics lesson, with nuanced interpretations of who could or could not enforce the agreement, when would or would not money flow from the project and how much, and who could or could not remove oil platforms, if production was terminated by PXP.

Lt. Gov. John Garamendi, resuming the post of chair of the three-member panel, and state Controller John Chiang voted against the leases. Thomas Sheehy, sitting in for state Director of Finance Michael Genest who usually sends a surrogate to SLC meetings, voted in favor of the motion he made to approve the proposal.

Speaker after speaker from Santa Barbara repeated a variant of the refrain, "We need the money" that would have come from the project—upfront fees, ad valorem taxes and royalties. But Garamendi, paraphrasing Genesis 25:29-34 before he voted,  said, "I will not sell the California birthright--the coast-- for an immediate meal."

Sheehy's desire to push the project was evident throughout the testimony, as he repeatedly tried to undercut the SLC staff recommendation against the project, calling it "hypothetical speculation" and "far-fetched."

The staff's primary concern was that an oil drilling termination date of 2022—the lynchpin of the EDC package—was not enforceable, which testimony by Ellen Aronson of the Minerals Management Service of the Department of Interior indirectly confirmed, but the proposal's supporters appeared to disregard.

A sizable contingent of Malibu opponents to the PXP deal testified at the hearing, expressing concerns voiced by local environmentalists, the Malibu City Council and the Malibu Coastal Lands Conservancy. Among the Malibuites who spoke were Sara Wan, Steve Uhring, Judy Fogel, Remy O'Neill and others who were part of the late-hour opposition turnout.

Wan told the commissioners, "This deal will not end drilling." Concern about increased danger of oil spills and the precedent-setting nature of a decision to allow the first new drilling of the California coast in 40 years open entire coast was reiterated by the local critics.

Garamendi said his no vote was based on the determination that the proposal was "not in the best interests of the state," the commission's charge when assessing public policy. He said, "This issue is important to the entire state...and the nation [because] it would provide a precedent for 'drill, baby, drill' proponents to urge Congress and the White House to resume offshore oil drilling."

Nagging concerns about full disclosure were also a factor. Chiang raised the issue that the confidentiality clause in the agreement precluded all of it from being made public until the day of the hearing." On anything to do with public lands," Chiang said, "The public should be able to review all documents."

Sheehy had appeared to be spinning so intently for the project throughout the meeting that Garamendi chided him with, " I notice the governor [now] supports offshore oil drilling, " which Sheehy ignored.

Midway through the meeting, Garamendi had offered Texas-based PXP the option of continuing the matter "so some of the [contested] issues could be explored further," but CEO James Flores responded, "We could continue to learn about this project for the rest of our lives. We want action taken today."

Garamendi replied, "OK, we vote up or down," and two hours later, on the day after the 40th anniversary of the disastrous Santa Barbara oil spill that spurred the state policy against drilling for four decades, the majority voted down.

Note: Full details and analysis of the CSLC decision will follow in the print and online editions of The News..