California’s ‘secret’ is threatening its climate

Bloomberg

In a parched and dusty patch of land in California’s central valley, a series of wells has been pumping out some of the state’s dirtiest crude oil.
Almost a century after the Chico-Martinez oilfield was first opened about 145 miles north of Los Angeles, it is still producing heavy crude. But to do it, drillers have turned to techniques — like injecting steam from gas-fired boilers to loosen the heavy crude deep underground — that have boosted carbon emissions 14-fold over the past decade.
The oil produced there has been emitting almost four times more carbon per barrel than the average of all crude used in California’s refineries, more than the oil dug out of Canada’s notorious oil sands and more than the oil extracted from the frozen tundra of Alaska’s arctic, according to state data. Just a few years ago, it was among the cleanest in the state.
While Chico-Martinez generates a fraction of California’s output, it illustrates a dilemma for a state striving to be a leader in slashing carbon emissions.
Increasingly, California’s aging oilfields require
ever more energy-intensive drilling methods, spurring environmental concerns and boosting fuel prices under a decade-old state program.
“They are a little bit chasing their tails on where to go while maintaining their climate leadership,” Deborah Gordon, senior fellow at the Watson Institute for International & Public Affairs, said. “We do know that as oil fields age, they tend to get more carbon intense.”
Under the state’s Low Carbon Fuel Standard program, refiners must purchase credits from producers of lower carbon-emitting fuels — including ethanol and biodiesel — to offset production of the higher-emitting motor fuels derived from crude. Those costs are then folded into the price of gasoline. The state’s goal is to cut carbon intensity of all transportation fuels by 20% by 2030. But the oilfields are an outlier. Producing the average barrel of California crude generates about 17 grams of carbon dioxide per megajoule of energy versus 11 grams for oil brought into the state from places such as Alaska, Iraq and Ecuador, according to state data.
Wells in the 640-acre Chico-Martinez field were acquired by a unit of Norway-based Crudecorp ASA about a decade ago. In 2012, the company began injecting steam, according to state data. Production rose to about 537 barrels a day, with about three barrels of steam being injected for each barrel of crude produced. But by 2015, that increased to ten barrels of steam for each oil barrel, even as the initial production surge subsided.
That gave the field the highest steam-to-oil ratio in the state, according to Dave Clegern, a spokesman for the California Air Resources Board. The field produced about 253 barrels a day in March, state data show.
In data published this month, a barrel of Chico-Martinez crude yielded 48.1 grams of CO2 per megajoule, up from 3.8 grams when the data was first published in 2012. The numbers include emissions recorded from the time a well is identified, to its drilling and the transport of oil to a refiner. This year, the company stopped all use of gas-fired boilers as of the first quarter, reducing its carbon intensity score to 5 grams of CO2 per megajoule, Geir Utne Berg, Crudecorp’s CEO, said.