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Brown ordered firing of regulator who took hard line on oil firms

The dispute centered on a risky method of extraction. California's governor has sued oil companies throughout his career, but he now talks of tossing cumbersome regulations to revive the economy.

January 29, 2012|By Michael J. Mishak, Los Angeles Times

Oil contractors began a letter-writing campaign, flooding the administration with complaints that the longer permit process was threatening their livelihoods. Occidental and Berry Petroleum Co. executives groused about the delays to analysts in their earnings calls, and Berry's chief executive officer said his Denver-based company would redirect investment outside California.

By October, Brown had asked that officials develop a permitting shortcut. According to Chernow's memo, the administration proposed allowing oil companies to begin drilling and injecting wells after submitting basic documents; they would be required to complete a full engineering review later and correct any problems after the fact.

Chernow argued that the proposal violated state and federal rules requiring a complete review before injection can begin and warned that it could open the state up to lawsuits. Environmentalists, he said, "will argue, correctly, that the laws … are intended to prevent damage before it occurs," he wrote.

Administration officials said they ultimately abandoned that proposal but agreed to the industry's request that some projects be green-lighted without a full review. The officials have returned much of the permitting power to district offices, saying Miller's headquarters mandate caused a backlog and created an unnecessary burden for the agency. They said at least 77 well permits that were on hold as of Nov. 15 have since been approved.

Reheis-Boyd of the Western States Petroleum Assn. praised the agency's new direction, saying it now has a "clear pathway for people to get permits and proceed with drilling in this state."

"The communications lines are very open," she said.

Brown boasted recently about the expedited permits. At a solar energy farm in a Sacramento suburb Jan. 13, he reaffirmed his commitment to all forms of energy development.

"It's not easy," Brown said. "There are going to be screw-ups. There are going to be bankruptcies. There will be indictments and there will be deaths. But we're going to keep going."

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