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E&B files application to drill for oil in Hermosa Beach

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E&B Natural Resources of Bakersfield on Thursday filed its highly-anticipated application to drill for oil and gas at the city maintenance yard at Valley Drive and Sixth Street.

E&B is hoping to build an underground cellar with up to 30 wells able to produce 8,000 barrels of oil and 2.5 million cubic feet of natural gas per day for 30-35 years.

Filing the application, which is more than 1,000 pages, is the first official step in a lengthy process that will ultimately lead to a vote at the polls by residents in 2014. Residents can download and view the entire application at hermosabch.org.

“We believe our project application, prepared by a team of professional experts and engineers over the past ten 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,” said Steve Layton, president of E&B.

Now that E&B has submitted its application, the city will determine whether it is complete, after which the city will hire a consultant to perform an environmental review of the project to make sure it meets the requirements of the California Environmental Quality Act. E&B will pay the cost of the consultant and the 2014 election, as part of the settlement reached with the city and Macpherson Oil earlier this year.

“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,” said Mayor Jeff Duclos. “As the lead agency for the environmental review, the city’s obligation is to be a provider of facts and information for the ongoing public discussion about the proposed oil production project.”

Jeff Cohn of Stop Oil in Hermosa, which opposes the project, insisted that the city erred by not already holding a public hearing.

“I’m disappointed in our public officials for not holding any public hearing to discuss the contract ahead of the proposal,” Cohn said.

E&B’s operations would be fully contained within a single site utilizing a “close loop system,” defined as a system that does not allow the venting or emitting of fluids into the atmosphere, according to the application. Neither would there be any controversial “hydraulic fracking” technology used for oil recovery.

The application breaks the proposed oil drilling project into four phases, including demolishing the site, initial construction and test phase, final construction phase, and a final drilling and production phase.

During the Phase 1, which would last about six months, the city’s 1.3-acre maintenance yard would be relocated and the site would be readied for drilling. City officials recently have said the most realistic location for a new maintenance yard site would be the storage facility next to city hall, which the city owns. The storage facility property was purchased in March 2005 for $4.2 million, and the city receives $15,000 a month in rent for a three-year term, due to expire in Jan. 31, 2015, city officials said.

Following the city’s general plan for truck routes, E&B proposes two different truck routes, including inbound trucks coming from Artesia Boulevard to PCH or from 190th Street to PCH, with both proposed routes proceeding to Pier Avenue and then to Valley Drive. Outbound trucks would leave southbound on Valley to 190th Street and proceed directly to either to I-405 at Crenshaw Boulevard or turn northbound on PCH and reach I-405 by Artesia Boulevard.

During Phase 2, E&B would investigate whether it’s an economically viable project, which would last about a year. E&B would drill a water injection well and set up an electric 87-foot tall drill rig that would be in place for four months. A large crane with a 150-foot tall boom would help erect the drill rig, which would be shipped to the site in 30 truckloads of equipment.

Drilling of the three test wells would occur 24 hours a day 7 days a week for about 30 days until the wells are complete. The three test wells would be drilled in a westward direction under the ocean.

Each well requires about 130,000 gallons of water to drill, and E&B plans to use reclaimed water from the West Basin Municipal Water District using an existing reclaimed water line across Valley Drive in the Green Belt, otherwise known as Veterans Parkway.

Testing of oil from the first well will determine whether to proceed with the project. The site would be left as a clean and graded site with retaining walls and a perimeter fence and landscaping if oil production is found to be not economically viable.

During Phase 3, which would last about 14 months, E&B would install underground pipelines for the processed oil and gas to be transported out of the area southbound along Valley Drive to Herondo Street and eastbound on 190th Street into Redondo Beach and Torrance to oil distribution locations.

E&B would install new street improvements, including new gutters and curbs and landscaping at Valley Drive and Sixth Street. Work would proceed from 8 a.m. to 3 p.m. on weekdays. The company would also build a small office building on the drill site and permanent equipment and utilities.

As many as 18 trucks a day would haul oil and soil out of Hermosa Beach during this phase.

E&B would also replace a 32-foot sound-proofing wall with a movable 10-foot tall sound proofing wall, as well as remove the four existing mature trees along Valley Drive. A 16-foot high block wall would be constructed around the project site with a 10-foot setback along Valley Drive and Sixth Street for allow for landscaping.

During Phase 4, the remaining wells would be drilled for a maximum of 30 oil and gas wells and four water injection wells. During this phase, E&B would conduct well operations maintenance, which includes re-drilling of wells utilizing a 102-foot tall ‘workover’ rig for a maximum of 90 days a year between 8 a.m. and 6 p.m. on weekdays. Operations would last another 32 years or so, according to the application.

In a noise impact study included in the application, Behrens and Associates of Inglewood found that noise levels during drilling and production would not exceed an oil code standard of 45 decibels at any residential property in the surrounding area. An air quality impact analysis said construction activities at the site would primarily consist of dust and exhaust emissions that could exceed the South Coast Air Quality District’s standard for significance.

“The proposed project would utilize the latest technology and operational advancements related to safety and efficiency in order to provide an oil development project that would be accomplished safely and in an environmentally sensitive manner and provide financial benefits to the community,” the application said.

Although residents last voted in 1995 to reinstate the no oil drilling ban, city voters are required to once again settle the question at the polls as part of a settlement between the city, E&B and Macpherson Oil reached earlier this year.

For nearly 15 years, Macpherson has claimed the City Council breached its contract when it rejected Macpherson’s drilling project in 1998 for safety reasons. Macpherson was seeking more than $750 million in damages and ready to go to trial when E&B stepped in and bought the rights from Macpherson for $30 million to try and drill in Hermosa Beach. If voters approve the project and the project receives approval from other government agencies, the city will pay E&B $3.5 million. If voters reject the project, the city will pay E&B $17.5 million.


Previously: Oil Trail: Crusades over crude oil span generations in Hermosa Beach

Previously: Drilling down into the Hermosa Beach oil deal



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