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Deal May Be Near for Venoco Pipeline in Goleta

City mulling multiparty agreement that would lead to Ellwood barge's decommissioning

Venoco Inc. may move one step closer Tuesday to installing a new pipeline that would bypass the oil company’s rather convoluted transfer system at Ellwood, but the project may run counter to Goleta’s General Plan goal of ridding the area of oil and gas operations.

The city of Goleta will consider a memorandum of understanding for joint review and preparation of an environmental impact report that may allow Venoco to construct a pipeline to connect its Ellwood Onshore Facility near Bacara Resort & Spa directly to the Plains All-American Pipeline near Las Flores Canyon, about 10 miles to the northwest. With jurisdictional boundaries at play with the project, the State Lands Commission is also involved, and Santa Barbara County will be the lead agency.

Construction of a multimillion-dollar pipeline was originally part of Venoco’s full-field development project, which, if given the go-ahead, would allow for expanded oil and gas extraction from existing wells via Platform Holly in the South Ellwood oil field.

Critics of the full-field project, aside from decrying the potential environmental impacts of intensified operations, have urged Venoco to eliminate the existing barge operation immediately instead of waiting for project approval.

Currently, oil is piped in from Platform Holly to the Ellwood Onshore Facility. The product then travels southeast from that facility to the Devereux area via Line 96 to be stored at the Ellwood Marine Terminal, located on UCSB land that is leased to Venoco until 2016 (a lease with the state for the offshore portion will be up for renewal in 2013). The oil is piped offshore from the marine terminal to the single-hulled barge Jovalan, which then transports the crude to market. Jovalan is the last remaining single-hulled oil barge in operation on the California coast.

In May, Venoco presented its new proposal for transporting the oil, which would bypass the marine terminal, the barge operation and a proposed alternative of transporting the crude by truck in case it can’t be transported by barge.

“Transporting the oil by pipeline is consistent with the city and county policies, UCSB will enjoy the new open space, and visitors to the Ellwood Mesa won’t see the barge visiting every 11 days,” Venoco representative Steve Greig said in May.

Steve Chase, Goleta’s director of planning and environmental services, was leery of the proposal, saying that while the decommissioning of the barge was a long-awaited benefit, the additional infrastructure would solidify and extend Venoco’s presence in the Ellwood area.

“Consistent with Goleta’s General Plan objectives, we would like all of the local oil works to decommission, particularly the oil and gas plant at Ellwood that the new pipeline intends to serve ... the proposed pipeline does nothing to aid that endeavor; in fact, it could be seen as stabilizing and increasing the life cycle of the processing plant,” he said in May in an e-mail to Noozhawk.

The State Lands Commission, in reviewing the environmental impacts of Venoco’s full-field development project last year, has stated that its environmentally preferred option for the transport of oil and gas from Platform Holly would be to construct a pipeline directly to the All-American line from the rig, thereby negating the need for any onshore oil facilities in Goleta.

Greig said it is not yet clear what the effects would be of breaking the pipeline construction project away from the full-field proposal, but the clamor for the decommissioning of the barge has been such that the company has decided to consider a project to do just that.

“We decided it was time to separate those two projects and move forward with just the pipeline,” he said. The life expectancy of the Ellwood Onshore Facility is a function of the supply of oil in the South Ellwood field, not the mode of transportation used to convey the crude.

For the city, meanwhile, there are still unanswered questions, such as where the oil might be processed, and what might become of the natural gas plant, which is also part of the Elwood operation. While the EIR will be focused on oil, Chase said, the presence or the potential relocation of the natural-gas operation also should be considered.

“We want solutions like everyone else,” he said. “We want to make certain the solutions address both oil and gas. Right now, only oil is on the table.”

Greig said preparation of the EIR for the Line 96 modification project shouldn’t take long since most of the information already has been gathered as part of the EIR for the full-field project. Should the EIR for the modification project be certified, construction of the new pipe would take about four months, he said.

Still, if the city finds that the EIR is inadequate despite county certification, according to the staff report, “a subsequent or supplemental EIR can be required of the project applicant.”

Noozhawk staff writer Sonia Fernandez can be reached at .(JavaScript must be enabled to view this email address).

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