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Local News

Venoco Sues Plains for Lost Profits After Refugio Oil Spill, Pipeline Shutdown

Venoco Inc. is suing Plains All-American Pipeline for more than $12 million in lost profits after the Refugio Oil Spill caused a shutdown of southern Santa Barbara County oil and gas transportation pipelines.

Plains owns and operates the Line 901 on the Gaviota Coast which ruptured May 19, 2015 and spilled crude oil onto the coastline and into the ocean. 

Federal investigators determined external pipeline corrosion caused the spill.

The Pipeline and Hazardous Materials Safety Administration shut down both of Plains’ local pipelines and oil companies, including Venoco, shut down their South County offshore platforms since there is no alternative way to transport the oil and gas products to refineries.

Platform Holly, off the coast of Goleta, is operated by Venoco which has offices in Denver, Colorado and Carpinteria.

Los Angeles-based attorney Steven Tekosky filed a civil suit in Santa Barbara County Superior Court Friday which asks Plains to pay Venoco $12.4 million in lost profits and/or earning capacity, as well as $108,900 in costs from accounting and financial experts.

Those losses are from May to November in 2015 and Venoco continues to rack up losses every day the pipelines stay shut down, according to court documents.

“Venoco is informed and thereon alleges that there is no date certain for the resumption of the pipeline’s operations,” the civil filing says.

Venoco filed a claim for the money with Plains on Dec. 31 but Plains hasn’t paid or committed to pay it, which led to the civil lawsuit, according to court documents.

In mid-March, Venoco filed for Chapter 11 bankruptcy to reduce the company’s debt and restructure itself while it deals with low oil prices and the pipeline closures. Platform Holly provided half of the company's production before the spill, according to the company. 

Noozhawk managing editor Giana Magnoli 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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