The Bakersfield energy firm E&B Natural Resources has submitted an application to drill for oil off the coast of Hermosa Beach - a move that will begin an independent public review of the proposed project.
"This marks the beginning of a long process that will provide the public with ample opportunities to ask questions and comment on the proposal, as well as learn more about the potential impacts and benefits of the project," Mayor Jeff Duclos said in a statement.
Ultimately, the fate of oil drilling in Hermosa lies with city voters. As part of a March settlement reached in a long-running lawsuit with Macpherson Oil, voters will get to weigh in on a ballot measure proposing to overturn the city's drilling ban. Steve Layton, president of E&B Natural Resources, has said the vote likely will occur in early 2014.
The company's drilling application includes details of the project's design, along with studies outlining risk assessments and noise and traffic impacts. The project will be conducted in four phases: site preparation, drilling and testing, construction and operations. Drilling would last up to 35 years.
The proposed project would use a directional drilling technique to tap oil off the coast from a city maintenance yard at Sixth Street and Valley Drive, rather than using offshore platforms.
It would involve drilling up to 30 oil wells, four water injection wells, a permanent processing facility and a set of pipelines.
The wells would be built behind a 16-foot-high wall and 10 feet of landscaping.
"We believe our project application, prepared by a team of professional experts and engineers over the past 10 months, exemplifies our commitment to incorporating today's latest proven technology that can address potential safety and environmental issues related to the project facilities and operations," Layton said.
The oil drilling plan is opposed by a group of residents. They have cited concerns about noise, traffic, public safety, pollution and ground water contamination.
If the measure passes, the project will require approvals from the California Coastal Commission, the State Lands Commission, the South Coast Air Quality Management District and the California Division of Oil, Gas and Geothermal Resources.
"I think (E&B officials) are going to have trouble getting through the Coastal Commission, the State Lands Commission and the voters of Hermosa once they realize how dangerous this project can be," former city Councilman Michael Keegan said. "The opportunity for accidents is high."
If the project moves forward, there's the potential for oil drilling royalties to the city of Hermosa Beach, the town's two-campus school district, and even residents. Questions linger, however, about whether funds could be secured for the city's general fund and school district if oil is tapped from the so-called tidelands zone, which is subject to certain state restrictions.
In March, city officials ended a lawsuit with a Santa Monica oil company that sought to drill from the maintenance yard, and that sued the city in 1998. The claim for damages from Macpherson Oil eventually grew to $750 million. Under the settlement, Hermosa would be obligated to pay E&B Natural Resources $17.5 million if the oil ballot measure is voted down.
Jeff Cohn, a resident who has spoken out against the proposed project in the past, said the agreement ending the lawsuit is illegal because, in part, it wasn't vetted publicly.
"They are jumping the gun and discussing the project," Cohn said. "We haven't even discussed the contract yet. It's unfortunate the city didn't follow what I would consider to be legal protocol."
The drilling project application from E&B Natural Resources can be viewed online at www.hermosabch.org.
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