California Relies on Imported Oil

SUPPORTING DOCUMENTATION

Alice Green, Board Member, SOS California,

Testimony before the House of Representatives Committee on Natural Resources

Energy and Mineral Resources Sub-Committee

 Energy Independence:  Domestic Opportunities to Reverse California’s Growing Dependence on Foreign Oil

 April 4, 2014

  

I would like to thank Chairman Lamborn, the Subcommittee and the Committee for the invitation to speak here today.  I am Alice Green, a Board Member of SOS California, a non-profit organization based in Santa Barbara, California.  Our mission is to reduce the impact of natural oil and gas seep pollution upon our ocean, beaches and atmosphere through education and awareness. Our goal is to alert the public to the magnitude of natural seep pollution in the Santa Barbara Channel, and to the availability of an invaluable resource to fund environmental cleanup and develop alternative energy sources. It is through collaboration with an informed public that we can build the bridge to a sustainable future.

We started SOS California in 2007 as a way to educate the public about the environmental damage caused by natural oil and gas seep pollution in the Santa Barbara Channel and about the benefits that we’ve realized from offshore development. The Santa Barbara coastline is polluted by oil and tar washing up on the beaches every day. It oozes up naturally through cracks on the ocean floor, fouling the water, the beaches, and the marine life. The natural gas that is released into the air creates methane and has become the largest source of air pollution in Santa Barbara County. The environmental impact of these “natural occurrences” is substantial, and we believe the economic impact from the unrealized revenue that basically washes away every day is significant as well.

That is why we are here today. The stated goal, and the work of SOS, speak directly to the subcommittee’s assertion that we have domestic opportunities to reverse California’s dependence on foreign oil, while providing support the economy, services to the community and the state, and increased employment. One of these opportunities lies right offshore Santa Barbara, California.

In the following pages, we will make the connection between natural oil seeps and the potential economic gains that can be realized in the State of California from reversing the federal and state moratoria on offshore oil and gas production.

To do that we will present the following:

  • Oil and Gas Reserves Offshore Santa Barbara: In this section, we provide data on the potential oil and gas reserves in the State of California-managed tidelands (within 3 miles from shore) and the Pacific Outer Continental Shelf (OCS) region that is leased by the Bureau of Ocean and Energy Management (BOEM).
  • Natural Phenomena – Oil and Gas Seeps: In this section, we describe the phenomena of natural oil and gas seeps, and the resulting environmental impacts.
  • Oil and Gas are Seeping from California’s Reserves: In this section, we will demonstrate the connection between natural oil seeps and the formations that contain the oil and gas reserves.
  • Offshore Oil and Gas Extraction Reduces Seepage along the Coast: In this section, we cite peer-reviewed studies proving that oil and gas production reduces the oil and gas seeps.
  • Reducing Seeps Improves the Environment: In this section, we show that reducing the seep outflow would benefit the environment.
  • California Relies on Imported Oil: In this section, we review California’s need for oil resources, and the state’s reliance on imported oil.
  • California’s Economic Challenges: In this section, we present evidence that California is struggling economically, and cannot afford to import a resource it has in abundance.
  • California’s Economic Solutions: In this section, we provide information on a recent study by the California Economic Forecast that shows that California has the potential to realize a large economic windfall if these oil and gas resources were to be developed.
  • California Projects Are Ready to Go: In this section, we demonstrate that, because of existing infrastructure, and the projects proposed, offshore resources could be in production within 14 to 18 months.

 

Oil and Gas Reserves Offshore Santa Barbara

The graphic below shows discovered, undeveloped oil fields offshore from Santa Barbara County, California. They include fields located in the OCS and well as within the state 3-mile limit (depicted by the shaded area that parallels the coastline).  In state and federal waters, there are 24 undeveloped oil and gas fields, but only 7 developed fields.

oil-gas-reserves-offshore-santa-barbara

Approximately 2 billion barrels offshore Santa Barbara are discovered, estimated and producible, but subject to state and federal moratoria on production. As this graphic depicts, the larger reserves are within 7 miles of the coast. This number is significant in that, with recently proven slant-drilling technology, formations within 7 miles of shore are accessible mostly from land-based slant drilling, with no offshore spill risk.  All reserves are near existing infrastructure and producible starting within 14 to 18 months with California and US approvals.

 

Natural Phenomena – Oil and Gas Seeps

The largest natural oil and gas seeps in the Western Hemisphere lie in the Santa Barbara Channel. According to the California State Lands Commission, they comprise more than 1,200 of the over 2,000 active submarine seeps along the California coast. Half of these occur within 3 miles of an area called Coal Oil Point, located just west of Santa Barbara near the University of California, Santa Barbara (UCSB) campus.

The map below shows the location of the oil and gas seeps offshore southern Santa Barbara County. Not coincidentally, most of the known but untapped Santa Barbara offshore oil and gas resources are in seepage zones.

Seepage-zones-santa-barbara

california-oil-gas-seepsdlegend

It is estimated that oil seepage for a single 6-mile stretch along the Santa Barbara coastline averages 10,000 gallons of oil each day (240 barrels). Every 12 months about 86,000 barrels of oil seep into the ocean—the equivalent of the quantity of oil spilled in the 1969 oil spill in Santa Barbara. Every 4 years the volume of oil seepage equates to the Valdez oil spill. Since 1970, the quantity of oil that naturally seeps into the Santa Barbara Channel equals approximately 31 “1969” oil spills.

There is also an extensive network of oil and gas seeps offshore from Santa Barbara’s North County, in an area known as the Santa Maria Basin.

santa-maria-basin

(Fischer, 1972 and 1998; Fischer and Stevenson 1973, and Saenz 2002)

 

Oil and Gas are Seeping from California’s Reserves

Crude oil and natural gas seep naturally out of fissures in the ocean seabed and eroding sedimentary rock. These seeps are natural springs where liquid and gaseous hydrocarbons leak out of the ground (like springs that ooze oil and gas instead of water). Whereas underground pools of water feed freshwater springs, oil and gas seeps are fed by natural underground accumulations of oil and natural gas.  Natural oil seeps are used in identifying potential petroleum reserves (Global Marine Oil Pollution Gateway).

The gas and oil originate from a petroleum reservoir 1,500 meters below the sea floor.gas-oil-originate They seep from the crests of anticlines exposed on the seafloor through as much as 60 meters of water to the surface. On the sea surface, locations of seeps are characterized by patches of bubbles and oil slicks that extend down-current. The photo above, from a Nekton, Inc. submersible dive in 1982, shows gas bubbles from the tar seeps in the Coal Oil Point area.

Viewed at the sea surface, seeps range from being so diffuse that they are undetectable to appearing on the surface as areas of effervescence or boiling, measuring 1 to 10 meters in diameter. A large amount of seepage takes the form of gas bubbles that emerge from the seafloor, carrying a thin coating of oil on their surfaces. Seepage also occurs as discrete oil droplets and as tar that oozes out and forms tar mounds on the seafloor. (Santa Barbara County Energy Division – http://www.sbcountyplanning.org/energy/information/seepspaper.asp#naturalSeeps)243

At right, the schematic shows a vertical slice through the Earth’s crust, with folded layers of sedimentary rocks holding oil and gas in the crest of an underground fold. (http://walrus.wr.usgs.gov/seeps/what.html)

When the fold extends to the land (or sea) surface, a seep can occur.  The schematic shows how natural seep oil is connected to the formations from which companies collect oil.

So we see that seep zones are related to untapped oil and gas reservoirs offshore from Santa Barbara County California. It is also clear that offshore seeps are the overwhelming source of our hydrocarbon pollution, not offshore oil extraction.

 

 

Offshore Oil and Gas Extraction Reduces Seepage along the Coast

Surprising to many is the fact that California offshore oil and gas production has been drying up seepage pollution.   Peer reviewed published reports document the connection between existing Santa Barbara offshore oil production and natural seepage pollution reductions over the last 20 years and the larger natural seepage pollution reduction potential through expanded offshore oil and gas production.  http://www.ia.ucsb.edu/pa/display.aspx?pkey=412

A press release from the University of California, Santa Barbara (UCSB) on November 18, 1999 referenced peer- reviewed studies that were published in vol. 104, no. c9, pages 20,703-20,711 (September 15, 1999 issue) of Geology Magazine & Journal of Geophysical Research- Oceans. That article stated the following:

  • “Natural seepage of hydrocarbons from the ocean floor… has been significantly reduced by oil production.”
  • “Studies of the area around Platform Holly show a 50 percent decrease in natural seepage over 22 years”
  • If oil were to be pumped out of the La Goleta Seep, researchers state that there would be “a reduction in non-methane hydrocarbon emission rates equivalent to removing half of the on-road vehicle traffic from Santa Barbara County.  In addition, a 50 percent reduction of seepage from the La Goleta seep would remove about 25 barrels of oil per day from the sea surface, which in turn would result in a 15 percent reduction in the amount of tar on Santa Barbara beaches.”

Platform Holly lies offshore from southern Santa Barbara County, and is operated by Venoco, Inc. The seep fields that surround Platform Holly are studied extensively by researchers from UCSB. A study of the platform that used sonar profiles shoed an 80 percent reduction in seepage in the area of operations.

area-of-operations

 

The UCSB seep study also stated that:

“The large reduction in the amount of tar found on Santa Barbara beaches between 1958 and 1977 may also be due to offshore oil production.” [Mertz 1959; Welday 1977]

This study and numerous other seep studies show that natural hydrocarbon seeps result from pressurized hydrocarbon reservoirs that force oil and gas up through fissures to the seabed floor where the hydrocarbons escape in the form of oil, tar, and methane-rich gases. Oil and gas production reduces the reservoir pressure, thus reducing this natural seepage pollution.

According to UCSB Geology Professor (Emeritus) Dr. James Boles, much of the active offshore seepage is in areas off-limits to new offshore production- areas that clearly would also see permanent reductions in seep oil pollution if production in those areas was permitted. When asked whether it was clear that there is a direct relationship between offshore oil production and seepage reduction, Dr. Boles replied, “Absolutely.  This is one of the very few places in the world you can actually document this.  There is no question that (production) would reduce the amount of seepage.  In fact, the present seepage offshore is greatest where you have unproduced state leases.”

 

Reducing Seeps Improves the Environment

Offshore oil and gas production can actually improve the marine environment.  Seeps pollute the ocean and beaches, sicken surfers, and are a significant source of air pollution in Santa Barbara County.

For example, in January 2005 an increase in this seepage created a 25-square-mile oil slick.  As many as 5,000 seabirds that washed ashore from Santa Barbara to Huntington Beach had been killed or oiled.

According to the 1999 UCSB seep study, “The decrease in hydrocarbon seepage rate near platform Holly, possibly due to the reduction in subsurface reservoir pressure, suggests that oil production here has resulted in an unexpected benefit to the atmosphere and marine environment.”…

 

California Relies on Imported Oil

It looks as though California has a lot of oil – and we do! So why are we importing it?

California is actually the second largest importer of oil in the nation – second only to the nation itself. The chart below shows a Los Angeles Basin Crude Oil Supply Outlook, and that oil imports are steadily increasing.

increasing

The following chart from the California Energy Commission (2012) shows crude oil supplies to California refineries, and shows the increase in foreign imports while domestic imports are decreasing.

crude-oil-supply-sources-to-california-refineries

According to the California Energy Commission, California is a net importer of oil. It produces only about 37.2 percent of the petroleum it uses. In 2007, the state spent nearly $50 billion for gasoline and $9.7 billion for diesel. Petroleum-based fuels account for 96 percent of the state’s transportation needs. The dependence on a single type of transportation makes Californians vulnerable to petroleum price spikes. Transportation is the largest emitter of greenhouse gases. The demand for gasoline and diesel fuel will continue to rise because of population growth, the lack of mass transit, and the number of sports utility vehicles on California’s roads.  Also, jobs and housing continue to become farther apart, increasing the miles traveled by the work force.