Oil majors are investing more…
Oil prices have been stuck…
Santa Barbara County has denied Exxon Mobil’s offer to provide tanker trucks to transport oil in Southern California until a pipeline that normally carries the crude is being repaired.
Exxon had offered to have the trucks, each with a capacity of 6,720 gallons, make as many as 192 trips per day. The oil giant had planned to use as many as eight trucks per hour, 24 hours a day, to move oil from a facility it owns near the Pacific coast to several destinations, including an oil refinery in San Luis Obispo County, about 70 miles to the north.
Related: Kurdish Oil Exports Under Threat
On June 9, though, Dianne Black, the assistant director of planning and development for Santa Barbara County, rejected Exxon’s application for an expedited “emergency” permit to ship the oil by truck during repairs to the pipeline. The conduit, owned by Plains All American Pipeline of Houston, was breached May 19, spilling about 100,000 gallons of crude oil along a scenic beach.
As a result, Exxon has had to cut daily oil and gas output by more than 60 percent. What it does produce, the company said, is stored in nearby tanks. But once these tanks are full, oil and gas production would have to stop altogether, possibly limiting essential public services by suspending deliveries to the Southern California Gas Co.
Related: Oil Markets Could Be In For A Shock From China Soon
Black wasn’t convinced. “There is no adequate evidence that a defined emergency exists,” she said. Black was tapped to make the decision because her superior, Planning and Development Director Glenn Russell, withdrew from the decision-making process because he recently owned stock in ExxonMobil.
ExxonMobil isn’t out of options, though. The county said the company could apply for a trucking permit without taking the emergency route, though that process can be more protracted and take even longer than it will to repair the pipeline because it would call for public hearings as well as an environmental review.
Exxon said it was considering its next move. “We are disappointed in this decision, which we have not yet had the opportunity to study in detail,” company spokesman Richard D. Keil said. “We will explore all options before us going forward, and we will continue to focus on operating in a safe and responsible manner.”
ExxonMobil was supported by the Western States Petroleum Association, an oil-industry lobbying group. It issued a statement saying Black’s decision “reflects an unfortunate lack of understanding of, or sensitivity to, the energy realities California faces” and would require the state to rely more on imported oil.
Related: Who Will Take The Energy Storage Crown?
Transportation of oil by truck has been phased out in Santa Barbara County since the 1970s. Instead, crude is moved through pipelines, which county authorities believe are safer alternatives. Evidently environmentalists agree.
“We applaud county officials for protecting the people and environment of Santa Barbara from this absurd and dangerous proposal,” said Kristen Monsell, an attorney with the Center for Biological Diversity. “Trucking a million gallons of crude oil a day down winding coastal highways is a recipe for another disaster.”
By Andy Tully Of Oilprice.com
More Top Reads From Oilprice.com:
Andy Tully is a veteran news reporter who is now the news editor for Oilprice.com