Monday, February 19 , 2018, 12:19 pm | Fair 56º


Dale Francisco: After the Spill, the Only Solution for Oil and Gas Transportation Is On the Road

The oil spill caused by a rupture in the Plains All American Pipeline coastal pipeline near Refugio Beach has led to demands for a quicker transition to renewable energy. Unfortunately, every energy technology, including electric car batteries and solar photovoltaic cells, has environmental costs that must be reckoned with.

Dale Francisco
Dale Francisco

Moreover, major technological transitions can be painfully slow.

Absent a scientific breakthrough, modern industrial societies will continue to rely on fossil fuels, hydroelectric power and nuclear energy for decades to come. The transition to other forms of energy is dependent on hard-won scientific and engineering advances, not political wish lists.

In the meantime, the oil and gas industry remains the most heavily regulated industry in Santa Barbara County, and the Santa Barbara County Planning and Development Department’s Energy Division has the strictest regulations on oil and gas production of any county in California.

Plains is taking full responsibility for the spill, as it should. With a thousand workers in the field, Plains is working diligently around the clock to clean up spilled oil and to repair the pipeline.

Pipelines are still the safest way to transport oil, and undoubtedly a study of the causes of this spill will result in better safeguards for pipeline operations.

But in the immediate future, the shutdown of the pipeline will create problems for all of Santa Barbara County.

Some of the biggest problems will result from the temporary shutdown of oil and gas production offshore, including from platforms belonging to Venoco, Freeport-McMoRan and ExxonMobil. ExxonMobil will also be forced to shut down its Las Flores Canyon onshore facility that processes the oil and natural gas produced by three of the offshore rigs.

With the Plains pipeline shut down, there’s nowhere for the oil produced at Las Flores to go. The quantities are staggering. Every day, the ExxonMobil rigs alone produce 30,000 barrels of oil and 20 million cubic feet of natural gas — which amounts to nearly the entire residential natural gas supply for Santa Barbara County.

Each of the other oil companies’ platforms are producing 3,000 to 4,000 barrels per day, and have already exhausted their storage capacity.

ExxonMobil is the third largest taxpayer in Santa Barbara County. Oil companies in California are taxed based on the oil they produce — as they produce it. Every year, Exxon’s operations contribute $4.2 million in revenue to Santa Barbara County. Of that, nearly $1 million goes to the county General Fund.

School districts benefit, as well. For instance, the Vista del Mar School District on the Gaviota coast receives nearly 40 percent of its budget from ExxonMobil taxes. Exxon tax revenue allocated to Santa Ynez Valley Union High School is worth $800 per student. The county Fire Department receives nearly $600,000 annually of Exxon revenue.

Some of the loss of natural gas could be made up through importing gas at a higher price, but once the oil and gas storage space at Las Flores fills up — as it will if the pipeline shutdown continues — Santa Barbara County will lose its largest single source of natural gas.

And if no more oil and gas is being produced at Las Flores, the county as well as schools and the fire department will immediately begin to lose millions of dollars in revenue that they counted on when making their budgets.

Many years in management and in shaping public policy have taught me that in a crisis, calm and careful analysis is the shortest route to the right solution.

There actually is an easy way to prevent this tremendous loss of natural gas supplies as well as the loss of county revenue. ExxonMobil has applied to the county for a temporary, emergency permit — valid only until the pipeline is repaired — that would allow ExxonMobil to transport oil by tanker truck to the Phillips 66 refinery in Santa Maria from Las Flores Canyon.

This emergency permit can only be approved after careful scrutiny for safety from the county’s Department of Planning and Development.

During this short-term crisis, while the Plains All American Pipeline line is shut down, trucking oil to Santa Maria from Las Flores Canyon is the only solution that will allow continued production of oil and gas, and the continued flow of tax revenue to the county.

Schools, public safety, even the ability of most residents to cook meals — each of these depends on a reliable supply of oil and gas. Approval of the permit will benefit all county residents — and denial would lead to immediate, unnecessary and completely avoidable harm.

Dale Francisco is a Santa Barbara city councilman.

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