Bill To Limit Foreign Oil Imports into CA, Foster More Statewide Production To Face Senate Comm. April 5th

A bill intended to push the state Legislature to prohibit the import of crude oil into California if the source of the oil is a foreign nation with demonstrated human rights abuses, or a foreign nation with environmental standards that are lower than those in California, was re-referred to the Senate Natural Resources and Water Committee and the Environmental Quality Committee this week following multiple changes in international oil imports and exports since mid-February.

Senate Bill 1319, authored by Senator Shannon Grove (R-Bakersfield), would, in addition to prohibiting importing oil from foreign nations with demonstrated human rights abuses and lower environmental standards, require the State Energy Resources Conservation and Development Commission (Energy Commission) to monitor foreign countries that export oil and identify on its internet website the countries that are subject to the prohibition. The Geologic Energy Management Division in the Department of Conservation would also be required to report on its internet website, on a quarterly basis, the amount of particulate matter released into the air from tanker ship emissions from oil imported into California.

Originally written and introduced in mid-February, only weeks before the Russian invasion of Ukraine caused many nations, including the U.S., to boycott Russian oil imports and the war causing oil prices to skyrocket, the bill originally had a slightly different intent. Due to California and many cities passing numerous laws designed to drastically cut back on oil in the state, such as a ban on oil extraction statewide by 2045, a ban on fracking by 2024, and Los Angeles looking to pass a bill ending all new oil and gas extraction sometime this year, many lawmakers have felt that the oil industry needs additional time to extract oil as the state transitions into a more electric and alternative fuel future.

A bill to limit foreign oil, foster growth in California

In a statement on Friday, Senator Grove noted that California is the seventh largest oil producing state in the country, extracting 391,000 barrels a day. However, California currently consumes 1.8 million barrels a day. With a baseline of oil costing $100 a barrel, consumers would send roughly $50 billion a year to other countries for imported oil. Under SB 1319, the number of countries importing oil into California would be reduced, forcing the state to import from countries that meet the new regulations, from other sources within the U.S., or to ramp up California oil production, approve the thousands of drilling permits currently under consideration by the state government, and fast track for measures to reduce state oil dependence.

“Governor Newsom’s energy policy has been to favor importing oil instead of producing it domestically,” said Senator Grove in a Friday statement. “Remarkably, more than a thousand drilling permits are currently awaiting approval by CalGem. Approval of these permits would expand production in the state, generate thousands of high paying jobs for Californians, improve our state’s energy security, and be done under the world’s most stringent environmental standards.”

Countries specifically under fire by SB 1319 are Ecuador, Iraq, and Saudi Arabia. Ecuador has been plagued by poor environmental standards as well as harsh treatment of indigenous groups in the country when it comes to extracting oil, while Iraq and Saudi Arabia have been called out by the US State Department and multiple international organization for humans rights abuses. In addition to production shifting back to California, Grove has said that the bill will also returns thousands of industry jobs back to California.

“California’s top three sources of foreign oil are Ecuador, Saudi Arabia, and Iraq,” added Senator Grove. “This puts the state’s energy security in the hands of countries that are actively hostile to California’s values when it comes to human, labor, and environmental rights. Almost 600 tanker ships spewing millions of tons of CO2 into the atmosphere are needed to meet California’s demand, when much of that oil can be produced here in California, by Californians.”

While there have been no major blocs of support or opposition yet, with members of both parties as well as impacted parties like the oil industry staying largely silent on it, many tied to the oil industry have said that the bill is trying to please as many people as possible. The recent Russian-Ukrainian War has also been cited as an additional factor of a need to reduce foreign oil due to price increases because of international boycotts.

SB 1319 to be heard in committees starting next month

“There’s a lot to unpack about SB 1319,” said “Hilary”, a former public relations worker with two oil companies who wished to remain anonymous, to the Globe on Friday. “A lot of groups will see through what is happening with the bill, since in the end it aims to increase California oil production following years  of increased restrictions. Environmentalists, of course, will hate this, even with the bone thrown to them in the bill with more tanker environmental observance. But they might find it hard to argue about withdrawing from places like Ecuador and countries with far fewer regulations than California. This way, it can at least be closely monitored, plus, there is an end date to it all in a way.”

“The oil industry will also have mixed feelings. That’s a lot of money many companies won’t be making through international  endeavors, but the chance to jump back on domestic oil production, especially if there is a mass approval of wells for one last hurrah of oil production in California, is enticing. Even states like Texas are struggling to do that right now. Democrats will hate a lot of this bill, but it could hurt many come November. If they vote against this, their opponents can say ‘My candidate says they are against human rights violations, but when this bill came forward, they refused to act on it.’ It’s a loaded bill for sure, so anyone planning to vote against it needs to plan out a nuanced response or the GOP, or Democrats as the case may be, can jump on it.”

“And finally Republicans. They’ll love a lot about this, but oil company apprehension could hit some. Plus, they probably will want an assurance that the state would bring back oil in a big way for awhile. They don’t want to pass this and then have the state ban more oil drilling or something.”

“All told, this is a very complex bill aimed at giving all sides something good and something bad in it. Question is though, do the pros outweigh the cons for them? Again, many will see this as a ploy to increase California oil production past stringent regulations. Supporters will really need to prove that is not the case, and if this survives through some committees, they may have to throw a few more bones to those against it.”