Michael S. Brown, President
The worldwide slump in crude oil and natural gas prices and the major Plains Pipeline leak and spill near Refugio State Beach last May continue to roil energy operations on and offshore along the Gaviota Coast in multiple ways. The final report from the federal agency charged with maintaining pipeline safety and proper operations (Pipeline and Hazardous Materials Safety Agency or PHMSA) issued findings late this winter indicating that the Plains Pipeline had:
- more corrosion than expected,
- more than reported,
- and more than was found by a scheduled mechanical in-pipe inspection;
- that more oil escaped than had been previously reported;
- that delays by company personnel in sounding the alarm was actually slower than originally reported;
- and that none of the occurrences and findings met current federal standards.
Because of questions about the reliability of automated in-pipe mechanical inspections, all the Pipeline components must be re-examined using different tools and techniques, before any normal operations can be resumed by Plains. No estimate was offered about when new pipeline transport could resume.
This PHMSA report gives extra credibility to several proposed improvements to pipeline inspection and safety now making their way through Congress, including an important one co-sponsored by Lois Capps. As the American Petroleum Institute remains opposed to any changes in inspection-regulation rules, the fate of the bills is uncertain during the current session.
The report findings do not directly affect other inquiries, such as the criminal investigation and civil action now ongoing.
Exxon is processing a permit application to truck a minimum "essential" amount of oil from its offshore platform that ordinarily would go through the Plains Pipeline, to clear its lines and draw down its storage holding tanks, which are now near maximum capacity. If approved by the County (and several state agencies), this would necessitate the use of extra-large oil trucks, making many multiple trips over at least one month's time, along the 101 on the Gaviota Coast.
The combination of the Plains Pipeline total shutdown and a depressed world oil and gas price have badly crippled income for Venoco over the past year. As a result, Venoco filed for federal bankruptcy protection in March. It should be clearly understood that this is not a bankruptcy process in which Venoco would permanently close operations, but rather one where it "reorganizes its operations and refinances its corporate debt."
Venoco borrowed significant sums of money in the prior decade when interest rates were relatively high, and with low revenue from Platform Holly on the Gaviota Coast due to the Plains Pipeline shutdown, plus the huge drop in world oil and gas prices, Venoco was challenged to service its existing debt.
As a probable condition of refinancing Venoco's debt, and reducing interest (and/or principal) on existing money owed, expect to see representatives of Venoco's major lenders assume a much larger role in Venoco's operations, until the bankruptcy is discharged, and the debt service has been paid down. How such changes to management or the corporate board might play out this year is unclear.
Because of a desire for additional revenue, Venoco's extended reach application to extract more oil or gas from the Santa Barbara Channel along the Gaviota Coast from Platform Holly continues to go before the California State Land Commission's three-person board, and whether Venoco's financial ills - or this year's election year stresses - affect the application's prospects remain unclear. The Gaviota Coast Conservancy is carefully monitoring Venoco's proposal for new energy operations in state waters off the Gaviota Coast.
Venoco is suing Plains All American Pipeline for $12.4 million in lost earnings.
Concurrently, the City of Goleta, as part of their first Local Coastal Plan and Zoning Code, have been evaluating Venoco's Ellwood Terminal (an inherited "nonconforming land use" from Santa Barbara County when Goleta incorporated), to ascertain whether they want to allow Venoco to continue Ellwood terminal operations under the new LCP and Zoning Code. To become better informed, Goleta City Council authorized consultants Baker & O'Brien to update a much earlier County study which tried to decide when Venoco's investment at Ellwood terminal would be fully amortized.
In fall of 2014, the study was welcomed by GCC and many other Goleta civic and conservation groups, if only to obtain more reliable and up-to-date information on Ellwood terminal's status. Goleta's original intent was for the Baker & O'Brien update-study to be completed in February of... 2015. But when there was no news from the City about the findings of the study by last fall (a year after it was initiated), many community groups began to press the City of Goleta to publicly release the new study's findings. That finally happened in mid-March 2016.
The updated Baker & O'Brien study indicates that Venoco had fully amortized their original investment at Ellwood Terminal some time between 2006-2008, which suggests that there are no orginal costs left for Venoco to recoup there.
Goleta City Council has yet to schedule new hearings to specifically offer their staff "guidance" on whether they want to retain Venoco operations at Ellwood terminal under the new LCP and Zoning Code; on whether such operations might be designated as "an acceptable use", "a nonconforming use" or an "unacceptable use". The latter, if it were made a legal finding, could necessitate Venoco to present a bonded plan to expeditiously begin an Ellwood Terminal "retirement" or shut-down plan, with attendant timelines, estimated costs, and a suite of "viable alternatives".
At present, there is no hint regarding which direction Goleta City Council might be leaning, nor even whether a final decision will be made before this fall's municipal elections.
6. Oil Train SLO hearings continue: Phillips Petroleum's application to ship large amounts of oil & gas to a proposed new facility in Nipomo [south San Luis Obispo County] by rail, across the Gaviota Coast[and many coastal communities, has gotten very high level of staff review, and very high level of community interest, testimony, and participation. The SLO County Planning Commission held multi-day hearings, just to receive public comment.
The status of the project - which GCC, like many area conservation groups, opposes - is undecided.
SLO County has set no firm timetable for a "final" decision. Given the exceptional level of public interest and controversy, experts predict that an appeal is a foregone conclusion, no matter how the issue is decided, and that litigation [by whichever side loses] is a real possibility. Because of the low world price for oil and gas, Phillips initial sense of urgency to process the application is somewhat reduced.
PROFILE: Oldest Ranching Family Celebrates 150 Years on the Gaviota Coast
Story by Guner Tautrim and Eric Hvolboll, images courtesy of Orella family archives
Family farmers are an anomaly along the Gaviota Coast – an anachronistic remnant of the past. Of the few ranching families left today on the coastal plain west of Goleta, only a handful date back into the 1800s. The most deep-rooted of these is the Orella family.
Five ranches in the Refugio area are still owned and operated by descendants of Bruno Orella and his wife, Mercedes Gonzales y Guevara.
Bruno Orella was Basque, born in Spain in 1830. After arriving in California during the gold rush era, he worked in the 1850s for the Gonzales family at their cattle ranch on the Oxnard plain, which they had received as a Mexican land grant in 1837. In 1858, Bruno Orella married Mercedes Gonzales y Guevara, the daughter of his employer, Leandro Gonzales.
Mercedes Gonzales y Guevara was born in Santa Barbara in 1841. Her family arrived in Santa Barbara and San Buenaventura in 1782. They were soldiers and settlers in Spain's colonization of California, and included indigenous Cahitan, Mexican, Black, Spanish and mestizo people from what is now Mexico.
One hundred and fifty years ago, in 1866, Bruno and Mercedes Orella moved to the Ortega adobes at the mouth of Corral Canyon between Refugio and El Capitan. The adobes are County Historical Landmarks, and are now owned by ExxonMobil.
Beginning in 1866, the Orellas purchased Refugio Canyon and then Venadito and Corral Canyons from the Ortega family, that had received the ranchos as land grants before the American conquest of California. The Orellas' ranch spread from the Tajiguas ridgeline to El Capitan Canyon, and included Refugio Beach.
The Orellas also maintained an adobe home on State Street in downtown Santa Barbara at the southwest corner of Figueroa Street. The adobe has been remodeled, and is now Aldo's Italian Restaurant.
In the 1880s, Bruno Orella invited three of his nephews from Spain to come to California and seek claims on public lands north of his ranch. All three, Julian Orella, Patricio Alegria and Ramon Saralegui, established ranches in upper Refugio Canyon before 1890.
When Bruno Orella died in 1901, his land was subdivided into 10 ranches for 10 of his children. The ranches produced sheep, cattle and then in the early 1900s, walnuts, lemons, lima beans and tomatoes. Garbanzos and avocados were farmed after 1950.
Over the ensuing century, eight of the 13 Orella family ranches were sold. Five, however, are still owned by Orella descendants.
In upper Refugio Canyon, Frank Alegria and Joyce Saralegui Orsua and their families live on their ancestors' two ranches, which their families have owned for about 130 years.
On the coast just west of El Capitan, the Erburu family, descendants of Juana Orella Erburu, have maintained their ranch overlooking the channel for 150 years.
At the mouth of Venadito Canyon and on the hills overlooking Refugio Beach, Mark Tautrim and his family operate Orella Ranch. In upper Venadito Canyon, Mark Tautrim's aunt, Elizabeth Erro Hvolboll and her family raise avocados on her grandmother Josefa Orella Erro's La Paloma Ranch, with its iconic 114-year-old single-board wooden ranch house. Both ranches date from 1866.
These five families have lived, ranched and farmed on the Gaviota Coast as neighbors and cousins for six and seven generations. While this span of time is very significant in California history, it of course pales to the Chumash people’s occupation of the coast for over 10,000 years. In fact, the historic period since the late 1700s is probably less than 2% of the time the land was occupied by Chumash people. Two of their largest villages, Kuyamu and Mikiw were located on the ocean bluffs at the mouth of Dos Pueblos Canyon. “Dos Pueblos” translates as “two villages” – named for these two villages.
There are a number of interesting historic sites on the coast in addition to the Corral Canyon adobes, including Refugio Cove, which was a prominent smuggling site during the Spanish and Mexican eras, the Vicente Ortega adobe at Arroyo Hondo (1842), Gaviota Pass and pier, built for Hollister/Dibblee cattle shipping (1875), Point Conception Lighthouse (1881), Vista del Mar School (1927) at Alcatraz, the World War II German POW camp (1944) on the Edwards Ranch, and the Pico adobe (1871) atop Refugio Pass – Ronald Reagan’s Western White House during the 1980s. Sadly, other landmarks such as the Den Adobe and the Naples Chapel at Dos Pueblos, as well as the 1916 Gaviota Store, have been lost.
Other families, including the De la Guerra-Dibblee family northwest of Gaviota Pass, the Giorgi family near Las Cruces, and the Dreyfus family in Eagle Canyon, have also operated ranches in the area for over a century.
Local stories and history are recounted in J. J. Hollister’s book, Gaviota Boy, Elizabeth Erro Hvolboll’s book, Mi Refugio, and artist Chris Chapman’s books, Portraits of Gaviota and earlier this year, Stories of Arroyo Hondo.
If you spend enough time on the coast, you’ll undoubtedly meet some of the Orella family or visit their isolated ranch homes. If you’re familiar with the rugged beauty of coast and nearby mountains, you’ll understand why they’ve stayed living there now for 150 years!