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AB-1519 Tidal and submerged lands: Long Beach Tidelands.(2001-2002)

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AB1519:v98#DOCUMENT

Amended  IN  Assembly  April 16, 2001

CALIFORNIA LEGISLATURE— 2001–2002 REGULAR SESSION

Assembly Bill
No. 1519

Introduced  by  Assembly Member Lowenthal, Oropeza

February 23, 2001

An act relating to tidal and submerged land.


LEGISLATIVE COUNSEL'S DIGEST


AB 1519, as amended, Lowenthal. Tidal and submerged lands: natural gas Long Beach Tidelands.
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Under existing law, jurisdiction of certain tidal and submerged lands of the state have has been granted to the City of Long Beach, and oil and natural gas are being produced on parts of those lands.
This bill would, notwithstanding certain provision of law relating thereto, provide that the City of Long Beach may retain and utilize, without cost to the city, all of the natural gas it produces from the tidal and submerged lands granted to the city within its jurisdiction for the purpose of producing electrical energy, providing natural gas services to the public at the most competitive price possible, and improving tidelands, coastal, and wetlands environments authorize the City of Long Beach to retain, out of specified oil revenue, as defined, received by the city each month, an amount to be placed in a fund to be used solely to pay that portion of the costs of plugging and abandoning oil and gas production facilities from the Long Beach Tidelands that are not the contractual responsibility of the contractor or other parties. The bill would require any moneys remaining in the fund after the completion of plugging and abandoning activities be remitted to the state, as specified.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

The Legislature hereby finds and declares that

SECTION 1.

 The Legislature finds and declares both of the following:
(a) The Long Beach Tidelands contains the largest number of oil and gas production facilities on the California coast. There are presently over 2,000 active wells.
(b) The statutory scheme that provided for this oil development did not specifically provide funds for abandonment. If these wells and other facilities are not abandoned in a timely manner, it will pose a serious health, safety, and environmental problem.

SEC. 2.

 (a) Notwithstanding subdivision (d) of Section 4 of Chapter 138 of the Statutes of 1964, First Extraordinary Session, the City of Long Beach may retain, out of the oil revenue, as defined in subdivision (b) of Section 1 of Chapter 138 of the Statutes of 1964, First Extraordinary Session, received by the city each month, an amount to be deposited in an Abandonment Fund to be used solely to pay that portion of the costs of plugging and abandoning all wells, and removing all oil and gas production facilities from the Long Beach Tidelands that are not the contractual responsibility of the contractor or other parties.
(b) Any oil revenue that is withheld monthly pursuant to subdivision (a) shall be based on a reasonable and good faith estimate of the remaining life of the oil field, and the amount of money that will be sufficient to cover fully the abandonment and removal costs by the time these costs will be incurred. However, the total amount deposited in the Abandonment Fund shall not exceed one hundred ninety million dollars ($190,000,000), and the amount to be withheld each month shall not exceed 50 percent of remaining oil revenue, as described in subdivision (d) of Section 4 of Chapter 138 of the Statutes of 1964, First Extraordinary Session. These limits may be adjusted with the consent of both the City of Long Beach and the State Lands Commission if and when it is necessary to ensure that there will be adequate money in the Abandonment Fund. If the City of Long Beach retains oil revenue pursuant to subdivision (a), the city shall invest the money in the Abandonment Fund in investments that are lawful for other city funds. All interest earned on the money in the Abandonment Fund shall remain in the fund.
(c) The State Lands Commission shall provide written approval to the City of Long Beach before the city may use money in the Abandonment Fund for the removal of any oil islands on the Long Beach Tidelands. The City of Long Beach, however, may expend those funds without that written approval for purposes authorized by this section relating to the plugging and abandoning of wells, and the removal of oil and gas production facilities other than the oil islands. Any moneys remaining in the fund after the completion of plugging and abandoning activities authorized by this section, shall be remitted to the state in accordance with the requirements of subdivision (d) of Section 4 of Chapter 138 of the Statutes of 1964, First Extraordinary Session. The administration of the Abandonment Fund shall be subject to the requirements of Section 10 of Chapter 138 of the Statutes of 1964, First Extraordinary Session.

there is a severe energy crisis within the State of California and that natural gas production and consumption are directly affected by this crisis.

SEC. 2.

The Legislature further finds and declares that there are reserves of oil and natural gas that are being produced by the City of Long Beach on tidal and submerged lands granted to the city by the State of California upon certain trusts and conditions pursuant to Chapter 676 of the Statutes of 1911, and Chapter 102 of the Statutes of 1925, Chapter 158 of the Statutes of 1935. The Legislature further finds and declares that there may be additional reserves of natural gas on those tidal and submerged land that have yet to be explored and produced by the City of Long Beach.
SEC. 3.

Notwithstanding the provisions of the grant statutes identified in Section 2 of this act and in Chapter 915 of the Statutes of 1951, Chapter 29 of the Statutes of 1956, Chapter 138 of the Statutes of 1964, First Extraordinary Session, and Chapter 941 of the Statutes of 1991, the City of Long Beach may retain and utilize, without cost to the city, all of the natural gas it produces from the tidal and submerged lands granted to the city within its jurisdiction for the purposes of producing electrical energy, providing natural gas services to the public at the most competitive price possible, and improving tidelands, coastal, and wetlands environments.