Orange County’s congressional delegation showed up in force Monday at an oversight hearing convened in Irvine over the recent oil spill, calling for an end to taxpayer subsidies for offshore drilling and drawing protests from Republican Party leaders who accused them of exploiting the leak to score political points.
The hearing of the House Natural Resources subcommittees – Oversight and Investigations, and Energy and Mineral Resources – featured testimony from environmental researchers and coastal businesses affected by the spill, along with a new round of calls from local members of Congress to end all drilling off California’s coast.
“The only foolproof way that we prevent another one of these spills is to stop drilling,” said Rep. Mike Levin (D-San Juan Capistrano) at the hearing, which was held in Irvine.
“It’s to stop all new drilling, and to decommission the 23 platforms that are out there,” he said, referring to the number of oil rigs operating in federal waters off California.
“I’ll keep fighting until we collectively come to the realization that we’ve got to get that done.”
Until drilling ends, local Congressional Democrats called for ending federal taxpayer subsidies they say keep these drilling rigs running even when they’re not profitable.
Rep. Katie Porter (D-Irvine) said the company whose pipeline leaked this month was paid nearly $20 million in federal subsidies because their well isn’t as profitable – something Porter said needs to stop.
“It turns out [Beta Operating] got nearly $20 million from the federal government – specifically because the oil wells are at their end of their lives and are not producing much oil, which makes them less profitable,” said Porter.
“So taxpayers are being asked to pay to encourage oil production in the Pacific Ocean, and giving oil companies millions of dollars to do it,” she said, adding that the subsidies would end in the proposed Build Back Better Act if it becomes law.
Beta’s parent company, Amplify Energy, did a major stock buyback just before receiving a $5.5 million payroll subsidy from the federal government, in the form of a Paycheck Protection Program loan that the government forgave.
“These subsidies are, in fact, a waste of taxpayer dollars,” Porter said.
“These subsidies – and so many others – are the reasons that oil wells like the one behind this leak are still active. Getting rid of the subsidies is the first step to get rid of the problem.”
The subcommittee heard testimony Monday that the oil company in the Refugio spill near Santa Barbara in 2015 ended up declaring bankruptcy twice and handing off its decommissioning costs to taxpayers.
Members of Congress said taxpayers are at risk holding the bag to clean up spills and decommissioning for the small companies that now own rigs and often go bankrupt.
“Oil and gas companies use shell corporations to get rid of their cleanup obligations, and they abuse the bankruptcy process,” Porter said.
“I think it’s very important to reinforce that taxpayers don’t get stuck with the bill, when it comes to the cleanup and when it comes to the decommissioning,” said Levin.
Republican members of the subcommittee did not attend or participate in Monday’s hearing.
The proceedings brought criticism from the state Republican Party’s leader, who said local Democrats are milking the oil spill for political purposes.
“Representatives Porter and Levin are trying to score political points but have been noticeably silent about President Biden’s supply chain crisis, rising inflation and why they think $3.5 trillion in new government spending, paid for by tax increases, will help middle-class Californians,” said California GOP Chairwoman Jessica Millan Patterson in a statement Monday.
“In a state already crippled by high cost-of-living, homelessness, and high unemployment, Californians deserve better, but Porter and Levin care more about party politics than the people they claim to represent.”
The oil drilling is enabled by politicians who take their campaign money and do their bidding, Levin said at Monday’s hearing.
“Fossil fuel companies that profit from drilling activities will say just about anything to protect their bottom line. And politicians who benefit from fossil fuel industry contributions will gladly follow along,” he said.
Terese Pearson, who runs a Newport Beach fishing business named Pearson’s Port with her husband, said at Monday’s hearing that the spill has been devastating for their company and other local fishermen.
“We are at a standstill with our business,” Peason told members of Congress at Monday’s hearing.
“People don’t realize that from Sunset Beach all the way past San Onofre, from the shore to 8 miles out, we are absolutely discluded – not allowed to fish. California lobster season, which is a multi-billion-dollar business for the state of California – all of the grounds for fishing are in those areas,” she added.
“They have let us know that it’s going to be at least December – at the very earliest – before we can fish these waters. There is a great chance that the holidays are going to be a bust for us. And when I say us, I mean the entire fleet.”
I think highlighting how complicated clean up is makes sense alongside subsidizing these industries that also don’t seem to have effective response plans where there is an issue
Monday’s hearing featured testimony from an expert witness who said Orange County is home to sensitive ecosystems like Talbert Marsh in Huntington Beach that are particularly at risk from oil spills.
“Oil can surge in with the tide, and it can get trapped in those environments, and it can get stuck and it won’t come back out when the tide recedes,” said David Valentine, a marine science professor and earth science chair at UC Santa Barbara, responding to a question from Porter.
“Those are especially vulnerable, because they’re these rich, diverse ecosystems.”
Levin noted local governments in OC are now starting to take up calls to bans on offshore drilling.
Huntington Beach City Council members on Tuesday are considering a resolution proposed by Mayor Kim Carr and Councilwoman Natalie Moser calling for “a permanent ban on new offshore oil and gas drilling, fracking, and other well stimulation in federal and state waters off the California coast.”
Laguna Beach could be taking it a step further on the same night – considering a resolution put forward by Mayor Bob Whalen and Mayor Pro Tem Sue Kempf declaring the city “supports ending all current and future offshore oil drilling and production operations” off California, and urging state and federal lawmakers “to pursue legislation to achieve this outcome.
At a hearing last Thursday, Congressional Democrats called for making oil companies put aside enough money to decommission their rigs and pipelines – something they’ve set less than 10% of the costs for, according to testimony they heard.
Chad Nelsen, CEO of the San Clemente-based Surfrider Foundation, told members of Congress on Monday that it’s time to get rid of the offshore rigs, which he said produce only a small amount of oil and jobs.
“I think it’s really important that we focus on decommissioning the existing rigs,” he said during a public comment session after the hearing.
Michael Wellborn – president of the Orange County environmental advocacy group Friends of Harbors, Beaches and Parks – said the local spill’s harm emanates from failures of national policy.
“It’s a national issue of resource extraction done the way we’ve always done it – where there’s no continuity of taking care of the lands when they’re quote-unquote ‘done,’ when they should be done,” he said.
“Which in my view is now, for most of them.”
Nick Gerda covers county government for Voice of OC. You can contact him at ngerda@voiceofoc.org.