Oil Firm Woos Torrance Residents Again

Dozens of residents applauded the Torrance City Council last fall when it unanimously rejected a plan by Kelt Energy Inc. to extract oil from beneath a southeast Torrance neighborhood.

Now, less than five months later, the company is considering a scaled-down project in the same area, and is working to win over its previous opponents.

Kelt officials have already met with the governing board of the Southeast Torrance Homeowners Assn., and the company will hold a public meeting at Hull Middle School Wednesday night to answer residents’ questions about the new project.

Kelt Division Manager Gregg Martin said this week that the meeting will most likely center on residents’ concerns about safety and noise, as well as questions about payments to residents who lease mineral rights to Kelt.

The new plan calls for 50 slant wells to be drilled from a 2.2-acre site on the northeast corner of Sepulveda Boulevard and Border Avenue into an oil field beneath a 648-acre neighborhood.

“We hope that people will come out with a lot of questions,” he said. “Afterward, we want to go back to the drawing board so we can come up with something agreeable to everybody.”

Once a project is rejected by the council a similar project cannot be resubmitted for six months. That would allow Kelt to submit a new plan after April 29, but Martin said the company has not decided when it will introduce the proposal. “We are not going to rush this,” he said.

Some city officials and residents said they are skeptical about Kelt’s new plan but that the public meeting may help to answer some of their concerns.

“I think it’s a step in the right direction,” said Councilwoman Dee Hardison. She is prohibited from voting on the project because she is part owner of a rental unit in the area.

Trying to Win Support

She said that even if Kelt wins over the residents, it must still address the concerns of the council.

Before the previous project was rejected in November, many of the residents who addressed the City Council said they feared the project might cause noise, dust and gas leaks and that ground movement might damage their homes and businesses.

“Apparently we didn’t reach a broad enough base” of support, Martin said. “We are trying to change that.”

Martin said the previous project met all state safety requirements, but he said the proposed new project would require fewer wells and would operate more efficiently.

The previous project called for 108 slant wells to be drilled from the site at Sepulveda Boulevard and Border Avenue into an oil field beneath a 560-acre area.

The field was roughly bounded by Sepulveda Boulevard, Crenshaw Boulevard, Western Avenue and the southern city limits. There are more than 2,000 residents and businesses in that area.

The 30-year project was expected to produce 27 million barrels of oil and raise about $300 million, based on 1988 oil prices.

The new project would have only 50 wells but would include an additional 88 acres to the north, Martin said. The new recovery area would be bounded roughly by Plaza Del Amo, Apple Avenue, Crenshaw Boulevard, Western Avenue and the southern city limits.

With the help of computer mapping and more efficient equipment, Kelt would be able to extract the same amount of oil using fewer wells, Martin said.

The new project is expected to last about the same length of time as the old one, 25 to 30 years.

$1 Million a Year

A Kelt study on the previous project estimated that the city and school district would have received about $1 million a year in royalties, taxes, permits and license fees. The amount paid to the lessors would depend on the amount of oil recovered, but the study said that the average lessor would have received about $2,000 a year if the project succeeded.

Martin said income projections remain similar for the new project but noted that volatile oil prices can affect income.

The wells would be drilled over a 2 1/2- to 3-year period by two 160-foot-tall drilling derricks, which would be encircled by a sound-dampening barrier, he said. The new plan would also include new subsurface pumping equipment, which would not be seen from outside the drilling site, he said.

Much of the neighborhood is over an oil field that has already been tapped by standard drilling and pumping methods. To force out the remaining oil, salt water would be pumped into injection wells. That would force the remaining oil toward recovery wells, which would be used to bring the oil to the surface. From there it would be piped to local refineries.

Address Public Concern

Mayor Katy Geissert said she voted against the previous project because it was too intense and too close to residential neighborhoods. However, she said Kelt’s approach in addressing public concern is “more positive than last time.”

John Bailey, a resident of the area who adamantly opposed the previous project said that Kelt “has a lot of selling to do. I hope this is a start of it.”

But he said he hasn’t been won over yet. “They have to gain credibility. . . . They haven’t changed my views on their operation.”

Martin said he expects the project to face some opposition. “You can explain something over and over again, and some people can’t be changed,” he said. “We’re hoping to appeal to a clear-thinking, decision-making body.”