Oil Field Owner Sues California over Law That Would End Its LA-Area Operations

The owner of an oil field in Los Angeles County is suing the state of California over a law that will require it to stop production and plug its wells or face costly fines.

Inglewood Oil Field owner Sentinel Peak argues in the lawsuit, filed this week, that the law, which was signed in September by Gov. Gavin Newsom, is unconstitutional, the Los Angeles Times reported Thursday.

It is was one of several laws aiming to reduce pollution by giving local governments more authority to restrict oil and gas operations by shutting down so-called idle wells, which are not in use but have not been properly sealed and closed, and fining companies for operating low-producing oil wells in the Inglewood field.

The 1,000-acre area southwest of downtown Los Angeles has approximately 820 unplugged wells, including 420 that are actively pumping. Roughly 80% of the operating wells are considered low-producing, meaning they yield less than 15 barrels of oil or 60,000 cubic feet of gas per day, the newspaper reported.

Attorneys for Sentinel Peak argue that the law “represents an illegal attempt to coerce an individual company to stop operation of its legal business,” according to court documents. They allege that mandatory fines, in particular, violate federal and state laws forbidding excessive fines.

The suit calls the penalties “grossly” disproportionate, with “no apparent upper limit” or “relationship to any actual harm.”

The California Department of Conservation’s Geological Energy Management Division, the state oil and gas regulator, declined to comment on the lawsuit.

But Assemblyman Isaac Bryan, a Democrat who represents the area where the oil field is located and who authored the law, vowed to defend it.

“Our community has stood strong for decades to close this dangerous low-producing oil field, and we will stand strong in court to protect those frontline communities who have long deserved the right to live a full and healthy life,” Bryan told the Times. “The people of California spoke through their legislature that dangerous oil wells have no business right next to the community.”