Drastic Flaws Revealed in City and State Oversight of Urban Oil Drill Sites


AllenCo Energy oil drill site in West Adams’ University Park neighborhod.
Closed since September 2013, the company is asking to resume pumping oil.
Note the immediate proximity of residential housing just over the drill site’s back wall.
Hundreds of people were sickened before the operation shut down.


Leslie Evans

The AllenCo Energy company, whose 21-well urban oil field at 814 W. 23rd Street in the University Park neighborhood just north of USC sickened hundreds of people from uncontrolled fumes, is now pressing to resume drilling operations, shut down since November 2013. This has brought some serious media attention, revealing a shocking systemic failure of both Los Angeles and California state oversight of such urban oil operations.


The states regulatory agency, the Division of Oil, Gas and Geothermal Resources (DOGGR), under pressure for failing to turn in reports for several years, released an audit of its work on October 8, 2015. This revealed that the agency has not conducted its required annual review of "most oil projects" in the Los Angeles area since 2007. The L.A. Times summarized:

"Seventy-eight percent of the projects in the audit did not undergo a required Area of Review. . . . Only five projects had undergone such an analysis in the last five years.



"Testing and methods to ensure that fluids injected into the ground dont contaminate aquifers or drinking water sources are inadequate and need to be updated.


"Well records were often incomplete or missing. At least  47% of the files did not contain information about well casings that is vital to understanding the integrity of wells."


And worst of all, the state regulators based what reports they did complete on self-reporting data by the oil companies which they could not verify.


Los Angeles sits on the largest urban oil field in the country, with some 5,000 active oil wells in the city, many immediately adjacent to homes and schools.


The Times followed up on October 14 with an equally disturbing report on how our city manages this industry based on highly toxic materials. Focusing on AllenCo Energy, L.A. Times reporters dug up the city Planning Departments list of conditions placed on the 23rd Street property back in the 1960s when it first became an oil field, then owned by Atlantic Richfield. These required that the company and any succeeding owner maintain "effective housekeeping" to prevent fumes, and authorized the city to shut the place down if it violated the conditions.


Local residents filed some 250 complaints about fumes from the AllenCo site to the South Coast Air Quality Management District (AQMD) between 2011 and 2013 when they and their children were suffering repeated asthma attacks, nosebleeds, and nausea. No one in the city bureaucracy remembered to look up the already existing conditions on the oil field, which would have authorized immediate action.


Single family home at 3025 S. Budlong Ave. at left, Freeport McMoRan’s Jefferson drill site
at right, separated by 8 foot wall. The tanks of industrial chemicals are mere feet away from
residents. One owner’s family had to move out and rent the house because the smells were so extreme.


Risks of Current Oil Operations

All of the 5,000 wells in our citys residential sites carry the risk of dangerous air pollution, both from the oil itself and from the large amounts of toxic chemicals used in its extraction. Most of the free flowing oil was exhausted by the 1980s. Many of todays urban oil operations use large amounts of acid, either to dissolve the sediment in which the remaining oil is embedded, or to frequently clean the sides of well bores coated with the oily sediment. A January 2015 report by the Community Health Councils notes that "Petroleum air toxics pose a significant risk when within 1,000 feet of people and oil-related smells can permeate the air for up to 3,000 feet." Three of the citys 70 oil sites are in South L.A.: AllenCo on 23rd Street in University Park, and two sites owned by Freeport McMoRan, the Murphy site at Adams and Gramercy and its Jefferson site at Jefferson Blvd. and Budlong Avenue. The average distance of the wells in these three sites from homes, parks, and schools is only 85 feet, by far the closest in the city.


No Expertise Among City Officials

It turns out that under city rules it is the Department of Building and Safety that is the agency that is supposed to enforce zoning conditions on oil production. They never saw the 250 complaints that went to AQMD. But even if they had, David Lara, Assistant Chief of LADBSs Inspection Bureau, told the Times that his staff lacks the expertise to investigate these cases.


Sometimes oil drill site cases go to Zoning Administrators in the Planning Department. But that agency last year said they did not have a system to "monitor and regularly enforce current conditions of compliance of existing oil and gas." They chose not to get involved in the AllenCo Energy case at all.


The most decisive action was taken by City Attorney Mike Feuer, who, at the request of Senator Barbara Boxer, filed a lawsuit against AllenCo.


The AQMD, as the main recipient of complaints, did take action, but it had little enforcement results, as AllenCo ignored them - until Mike Feuers lawsuit. The rogue company has now spent almost $1 million in fines and repairs on its University Park property.


AQMD Settles with AllenCo

The AQMD settled with them in September for a fine of $144,250, bringing their total fines, including earlier ones, to $215,750. In a September 25, 2015, press release the AQMD said it had made 85 inspections of the AllenCo drill site and issued 18 air pollution violations. As part of the settlement AQMD has issued a new operating permit to AllenCo. Actual drilling is still being postponed until the City Attorney verifies that all bad conditions have been fixed.


City Councilmember Gil Cedillo and Mayor Eric Garcetti in 2013 both demanded that the Planning Department send them copies of the original zoning conditions on the 23rd Street drill site. The Planning Department never produced this document until the L.A. Times got it from them this month.


Asking the Pope to Intervene to  Divest Church Oil Holdings

One related issue is that the land for both the AllenCo Energy site and another controversial drill site, on Adams Blvd. at Gramercy Place owned by the giant Freeport McMoRan Oil and Gas Company, is owned by the Catholic Church. Residents in University Park have appealed to Pope Francis to have the Los Angeles Archdiocese cancel AllenCos lease, in keeping with his encyclical calling for a drastic reduction in the use of fossil fuels.


The Christian Science Monitor on September 22 quoted Milwaukee Capuchin Franciscan priest Father Michael Crosby as saying,


"I expect that every Catholic institution in the country will step back and review all their practices - their teaching and preaching, their operations and investments - to determine whether they are in line with Pope Francis powerful call to action." The Monitor made a special point that the Los Angeles Archdiocese has decided not to cancel the lease on the AllenCo drill site, commenting, "The easy money from fossil fuel drilling may be just too appealing."