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Tsvetana Paraskova

Tsvetana Paraskova

Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. 

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Trump’s New Plan To Spark A California Oil Boom

The Trump Administration proposed last week to open more than 700,000 acres of federal land to new oil and gas drilling along California’s Central Coast.  

The plan is the Bureau of Land Management’s commitment to a 2013 court order to issue a more detailed environmental impact assessment of oil and gas drilling and the potential impacts of fracking, before proposing new acreage to fossil fuel development in the state.  

The Administration’s plan faces an uphill battle in California, which has been challenging nearly all federal environmental-related and emission proposal rules and which continues to pledge its commitment to the Paris Agreement regardless of the Trump Administration’s withdrawal from it.

While the federal government says that the plan to open more federal land to drilling in California will create jobs and economic opportunities for the local communities, California’s governor and environmental organizations already voiced their opposition to the proposal, while energy experts say that the oil industry won’t be flocking to drill in Central California because it is expensive.

The Bureau of Land Management (BLM) says that its plan would affect some 800,000 acres of Federal mineral estate, primarily located in the Fresno, Monterey, and San Benito counties. The BLM forecasts that up to 37 new oil and gas wells could be drilled over the next 20 years on federal land in the planning area. According to the BLM, the oil and gas industry on private and public lands in those three counties directly supports around 3,000 jobs and US$623 million in tax revenue.

The BLM’s plan, released on May 9 and published in the Federal Register on May 10, now has a 30-day protest period and 60-day governor’s consistency review. Related: Global Oil Flows At Stake In New Middle East Proxy War

California’s Governor Gavin Newsom already weighed in with his first reaction to the plan, tweeting at the end of last week “Handing over our public lands for more oil drilling is the last thing we should be doing. It threatens our environment. Our health. Our future. Climate change is real. Ignoring it will not make it go away. We need to build a future beyond fossil fuels.”

Environmentalists are naturally upset with the plans.

“Trump’s new plan aims to stab oil derricks and fracking rigs into some of California’s most beautiful landscapes,” Clare Lakewood, a senior attorney at the Center for Biological Diversity, said in a statement. “From Monterey to the Bay Area, the president wants to let oil companies drill and spill their way across our beloved public lands and wildlife habitat. As we fight climate chaos, there’s no justification for any new drilling and fracking, let alone this outrageous assault on our pristine wild places,” Lakewood added.

California’s crude oil production has been steadily declining since its peak in 1985: last year, California’s crude oil production fell by 13,000 bpd, the state’s fourth consecutive annual decline, according to the EIA.

At the same time, California boasts the number-one spot in the U.S. solar energy rankings, with installed solar capacity enough to power more than 6 million homes, data from the Solar Energy Industries Association (SEIA) shows. Solar power currently provides almost 19 percent of California’s electricity, but it must play a bigger role if the state is to reach climate and energy goals, SEIA says.

California has its own climate goal plan that includes having 50 percent of the state’s electricity from renewable sources by 2030, and 100 percent carbon-free sources of electricity by 2045.

To help California achieve its emission goals, Restore California Renewable Restaurants is proposing a 1-percent optional surcharge to restaurant checks in the state. The fee, to be optionally added to restaurant bills at the restaurant’s discretion, will be spent on carbon plans for farms and ranches. Related: Could This Emerging Oil State Become The Richest Nation In The World?

California is also fighting to save its car emission regulations, which are stricter than federal regulations. Earlier this year California sued the Trump Administration to compel the National Highway Traffic Safety Administration (NHTSA) and the U.S. Environmental Protection Agency (EPA) to release documents explaining “how and why the Trump Administration decided to arbitrarily roll back Obama-era clean air standards, and in doing so, do serious damage to America’s efforts to combat climate change.”  

Even if the federal government were to open more federal land in California to oil drilling, which could be years away given that California and environmentalists are expected to fight the proposal, there won’t be many drillers rushing to pump oil and gas.

“There’s only going to be new drilling if there’s someone who has property nearby and they want to extend what they’re doing on the federal pocket next door,” Amy Myers Jaffe, a senior fellow at the non-profit Council on Foreign Relations, told The San Francisco Chronicle, noting that drilling is “so expensive in California, it’s hard for me to believe that anyone is doing it.”

By Tsvetana Paraskova for Oilprice.com

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