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Bill on Pipeline Linking L.A., Texas Clears Assembly

August 28, 1986|DARYL KELLEY | Times Staff Writer

SACRAMENTO — The Assembly on Wednesday passed a bill that would clear the way for construction of a $1.66-billion pipeline that its sponsors say could begin carrying Alaskan crude oil from Los Angeles Harbor to Texas by late next year.

The bill, which was sent to the Senate, gives the Los Angeles Harbor Department permission to spend about $15 million to clean up a San Diego County lagoon to offset damage to coastal wetlands that the pipeline project would cause at the Los Angeles Harbor. State law requires that projects in the Coastal Zone that harm the environment must be offset with improvements to another coastal area.

The harbor supports the pipeline proposal because it could generate revenue in the range of $15 million a year.

The project could handle 900,000 barrels of crude oil a day, the equivalent of 34 super tankers a month, and could cut delivery time for Alaskan oil from from 18 to 9 days, said a spokeswoman for the company that is planning to build the project. Much of the oil is currently shipped through the Panama Canal.

The bill was passed 55 to 13 by the Assembly, where it had been stuck since early July, after Assemblywoman Maxine Waters and Assemblyman Mike Roos, both Los Angeles Democrats, said they were satisfied that there are no suitable coastal wetlands near Los Angeles where the city-run port could spend the $15 million.

Sanitation Facility

Waters and Roos inserted an amendment in the bill, however, requiring the port to provide a sanitation facility for recreational boaters at Cabrillo Marina in San Pedro.

If the measure by Sen. Ralph C. Dills (D-Gardena) also passes the Senate and is signed by Gov. George Deukmejian, an eight-party agreement to restore and maintain the Batiquitos Lagoon in Carlsbad could be signed within a few days, state and local officials said.

That agreement would pave the way for issuance of a California Coastal Commission building permit to Pacific Texas Pipeline Co. of Long Beach, they said.

A Pacific Texas spokeswoman said the company has nearly all of the 800 local, state and federal permits that it needs to begin laying 42-inch diameter steel pipe below ground from a landfill south of Terminal Island. The pipeline would run along local flood control channels to Rialto, then to Arizona and New Mexico to refineries in Midland, Tex., a distance of 1,030 miles.

Construction is set to begin in December, and the pipeline is expected to be operational a year later, said Margaret Kilgore of Pacific Texas.

However, she said, Pacific Texas has not yet signed contracts with the three major oil companies that extract oil from Alaska's North Slope--Exxon, Arco and Standard Oil of Ohio. The company has also not signed a financing agreement, she said.

Once Pacific Texas has received its final governmental permits, the company will sign agreements with the oil companies, which, in turn, will be used as collateral to obtain bank financing, Kilgore said.

Pacific Texas announced its pipeline project in 1982, three years after Standard Oil of Ohio had abandoned a similar plan for the Long Beach Harbor. Sohio dropped its project after a four-year battle with government agencies and environmental groups.

The Pacific Texas proposal, which includes high-tech "scrubbers" designed to trap pollutants when oil is transferred from ships at the port, has faced limited opposition.

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