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Friday, January 18 , 2019, 9:18 pm | Fair 52º


In Budgetary Move, Venoco Defers Start of Environmental Review for Paredon Project

Falling oil and gas prices have forced Venoco Inc. to postpone plans to pursue an environmental impact report examining a proposed slant-drilling development called the Paredon project.

The delay announcement comes a week after the Carpinteria City Council unanimously voted to enter into a contract with Ventura-based Marine Research Specialists to prepare an EIR.

The oil company was set to pay the total EIR cost of nearly $480,000.

Venoco, which submitted its most recent project plans in June 2013, proposes to drill up to 22 extended-reach (or slant) wells to recover oil and gas resources from onshore and offshore reservoirs at the Carpinteria Oil and Gas Processing Facility the company owns on Dump Road.

The oil company has not withdrawn the project but will defer the start of the expensive EIR process indefinitely, said Keith Wenal, Venoco’s manager of health, environment and safety.

“The oil and gas industry has experienced a significant downturn in commodity pricing over the last quarter which has directly affected Venoco’s spending priorities and budgets for 2015, including advancing Venoco’s Paredon Project,” Wenal said in a statement. “During periods of low commodity prices and the associated reductions in revenue, it is important for our business to prioritize operating expenditures. As always, Venoco’s first and foremost priority is to ensure existing operations remain safe and reliable.

“This has resulted in the necessary slowdown of expenditures required for longer term development or growth plans,” he continued. “The estimated total cost of the Paredon Project Environmental Impact Report process during 2015 was planned to be over $500,000, including EIR consultant and Carpinteria city staff costs.”

Wenal said “it is not possible for Venoco to accurately state when commodity prices will stabilize sufficiently to enable a restart of the project EIR.”

Carpinteria officials weren’t given an idea of when the EIR processing would begin, either, said Jackie Campbell, the city’s community development director. 

Locals last saw mention of the Paredon project in 2010, when residents decisively voted down the Measure J ballot measure, which sought to qualify the Venoco project as a private development not subject to environmental review.

Last week, Carpinteria staff informed council members the city would partner with the California Coastal Commission and the State Lands Commission to establish a joint review panel reviewing the EIR to better share information and input.

The public was supposed to get its first look at the proposed EIR in late July.

Campbell said the city would continue working with Venoco on a long-term plan.

Venoco and prior owners have operated the Carpinteria Processing Facility near the Carpinteria Bluffs area since the 1960s — Venoco bought the site in 1999 — and the area currently handles production from the company's Platform Gail and Platform Grace.

City staff estimated the Paredon project area contains recoverable reserves of approximately 20.5 million barrels of oil and 30.8 billion standard cubic feet of natural gas.

Venoco officials have said production would be viable for 20 years when started, depending on future commodity prices and reservoir performance.

Noozhawk staff writer Gina Potthoff can be reached at .(JavaScript must be enabled to view this email address). Follow Noozhawk on Twitter: @noozhawk, @NoozhawkNews and @NoozhawkBiz. Connect with Noozhawk on Facebook.

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