Permit for Firms to Use Oil, Gas Platforms Lifted

In a major setback to plans by two oil companies, the Santa Barbara County Planning Commission ruled Tuesday that a permit authorizing them to begin pumping oil and gas from recently completed offshore platforms is no longer valid because the firms underestimated concentrations of poisonous hydrogen sulfide in the natural gas.

The decision could mean up to a year’s delay in production from three offshore oil platforms operated by Chevron U.S.A. Inc. and Texaco Inc., assuming that the county issues a new permit. A Chevron attorney said Tuesday that each day’s delay will cost the companies a combined $500,000 in lost income.

Under the oil companies’ plans, crude oil and natural gas would be pumped from the offshore fields through separate oil and gas pipelines leading onshore near Point Conception and on to processing plants at Gaviota. At the processing plant, impurities would be removed from the crude oil and hydrogen sulfide would be removed from natural gas before shipment to a refinery.

When the permit was issued in August, 1985, it was based on a finding that average concentrations of hydrogen sulfide in the gas would run about 7,000 parts per million. It later developed that average concentrations were 15,000 p.p.m.

Concentrations that high would mean that in the event of a leak, a considerably larger area would be exposed to potentially lethal levels of hydrogen sulfide, said Dianne Guzman, director of the county’s Resource Management Department.

Chevron attorney Ralph Mayo said the oil companies will appeal the commission’s 5-0 vote to the Santa Barbara County Board of Supervisors.

“We are very disappointed. We think that the facts and the technical expertise that goes along with these facts and the science really bear out a decision that is contrary to the decision made by the Planning Commission. The experts in this field say there really isn’t a significant change,” Mayo said in an interview.

Guzman said the county informed the oil companies about a year ago that, in view of the higher concentrations of hydrogen sulfide, the original permit would probably require modification, a time-consuming process that would permit opponents to appeal any favorable county action to the California Coastal Commission.

Instead, she said, the oil companies opted for what they thought would be a less-time-consuming process by simply urging the county to make an administrative change in the permit. The county Planning Commission, after a year of testimony and reports, said Tuesday that the original permit would not suffice.

Mayo acknowledged that some time after the firms applied in 1983 for the original permit “there was some initial indication early on there could be some higher levels” of hydrogen sulfide. But at the time, he said, the federal Minerals Management Service, the state, the county and the oil companies agreed that 7,000 p.p.m. was the best information available.

Chevron and Texaco have spent $2 billion for the platforms--Texaco’s Harvest and Chevron’s Hermosa and Hidalgo--and the pipelines leading onshore and the oil and gas processing plants. Ultimately, the processing plants would handle up to 200,000 barrels of crude oil a day and 120 million standard cubic feet of natural gas.