Oil Wells Try to Get Along With People Next Door

They pump on vacant lots and in the middle of busy shopping centers. Some are sandwiched between homes. In Redondo Beach, they creak and groan within a few steps of a city tennis club.

They are the urban oil wells of the South Bay--steel “rocking horses” as tall as 35 feet that are the legacy of petroleum development that began in 1922 with discovery of the Torrance oil field. Today, 12 producing fields remain--ranging from two that have only one active well each to one of the most important fields in the country.

Most of the oil these fields produce is refined and used nearby. Your car may be running on it.

Well in Parking Lot

“The wells were there before anything else was. In the ‘20s, this was all bean fields,” said John W. Parkin, vice president of Del Amo Energy Co., which pumps oil from a large area centered at the Del Amo Fashion Center in Torrance. The mall has a well in one of its parking lots.

But as the farms and small towns of the South Bay have become a highly urbanized area, oil production--still profitable and expected to continue for decades--has required a complex balancing of the interests of oil producers, people whose homes and businesses stand next to oil wells, and cities striving for harmonious land uses.

One method being used to reduce the number of wells is consolidation, which uses central drill sites and diagonal drilling over extensive underground areas. Walls and landscaping also are used to shield wells from view.

In Torrance, for example, wells near the Park del Amo residential and business development are being relocated to walled drill sites intended to minimize their effect on the surrounding area. The city hopes eventually to consolidate a scattering of independent wells in southeast Torrance into a central drill site so wells that pump next to homes can be shut down.

More than a decade ago, surface storage and trucking of oil was eliminated in a portion of Wilmington when Exxon, a major well operator there, got several smaller operators to join in a consolidated production unit.

“Because of the need to produce oil in our country, there is strong support to allow oil production in the urban areas,” said Ralph C. Grippo, building and safety director in Torrance, which has about 200 wells.

Many Old Wells Still Pumping

But at the same time, he said, South Bay oil fields are old and contain wells that have been pumping for years, making them more likely to cause odors, have breakdowns and even blowouts--in which accumulated pressure forces steam, mud or water out of a well.

Blowouts, which Grippo described as “messy but not dangerous,” are rare, he said. The last one in Torrance occurred more than a year ago in a neighborhood on 228th Street.

Neighborhood disapproval of a well is not a basis for removing it. Most oil-well operators have leases with property owners that give them the right to operate wells as long as they produce oil and are maintained within state and local regulations.

Disapproval of oil wells is growing, however, in the Wilmington and Harbor City area, where a committee of residents and business people is working to revise the community plan and upgrade the area. Nearly 1,300 producing wells remain in the onshore portion of the Wilmington field, including wells in the Port of Long Beach, according to the state oil and gas office.

“There is an awful lot of land given over to oil production,” said Scott Hanlon, a labor union field representative who heads the plan committee. “As important as that is to oil companies, it is substandard land use from the vantage point of the rest of the community. The fact that a rocking horse is on a lot prohibits its use for any other purpose.”

Hanlon said he would like to see a stricter oil code and more advanced drilling operations that require less land.

Exxon spokesman D. I. Bolding said the company solved some major environmental problems in Wilmington 12 years ago when it worked with 119 operators to create a production unit with pipelines leading to a central collection center on Anaheim Street.

“By doing this, we removed 300 storage tanks and trucks that had to pump oil out of the tanks and haul it to refineries,” he said. Exxon has 265 wells producing an average of 6,000 barrels a day.

Officials involved in the supervision of urban oil wells say that while the wells sometimes generate complaints about noise and odor, they are not safety hazards.

The state Division of Oil and Gas, which regulates the drilling and production of wells, requires that well sites be fenced, with barbed wire along the top of the enclosure. The owner must be clearly identified and fluids must be contained to prevent leaking. Nancy Gaede, an environmental engineer with the division’s Long Beach office, said all well sites are inspected annually and there are “few complaints” about wells. She said the division does not keep track of the number of complaints.

Inspected Regularly

Oil company workers regularly inspect wells to see that they are working properly and and producing oil and that all liquids are being pumped off. Periodically, three- or four-person crews don hard hats and move in 80-foot-tall rigs to pull worn or damaged pumps and tubes that carry oil to the surface.

“Pumps wear out and tubings get holes worn in them and have to be replaced,” said Jerry Sampson, Torrance production manager for Santa Fe Energy Co.

Gerard Drissen, who lives on 231st Street in Torrance, said he pays little attention to the two oil wells that pump next to his home. “It was here when I moved here, so what can I do about it?”

In Harbor City, Lamoin Newman said the oil pumping operation behind her Halldale Avenue home gets “real bad” only once a month when crews make noise while doing maintenance at the well. Newman said she thinks she probably paid $5,000 less for her house--which she bought for $126,000 in April, 1983--because of the well.

Residents Evacuated

But on 228th Street where the last Torrance blowout occurred in March, 1984, residents have not forgotten about being evacuated from their homes overnight after pressure built up in a well and it began emitting loud noises and steam.

“The city and the oil people didn’t know what would happen and it was quite scary,” said Amy Kundakjian, who lives across the street from the well. Workers spent several days redrilling the wells and replacing casings that had given way, neighbors said.

At the time, Kundakjian was a member of the city’s Environmental Quality and Energy Conservation Commission and she urged that neighborhood wells in southeast Torrance be consolidated at a central drill site.

The city is working with Santa Fe Energy on such a plan, which would require bringing all well owners into a production unit. Isolated wells would be shut down and oil would be recovered by wells drilled diagonally from a central six-acre site. Royalties would be shared by all participants.

“This is complicated because of multi-ownership,” Torrance building director Grippo said.

‘Strict but Fair’

He said Torrance requires owners of independent wells to demonstrate every three years that they are complying with city requirements for walls, fences and landscaping.

Del Amo Energy’s Parkin said Torrance is “strict but fair” in its handling of oil wells, which, he said, is essentially aimed at promoting aesthetics and prohibiting the use of heavy, noisy equipment at night or on weekends.

Four years ago, the company spent $45 million to build a drill site on Torrance Boulevard near Madrona Avenue. Parkin said it took five years to get a permit from the city and there were continual “objections from citizens about having to stare at pumping units going up and down.”

As a result, the drill site is walled and behind it, a deep pit conceals 41 producing wells. They draw oil from throughout the sprawling Del Amo center using diagonal wells. Parkin said the site produces $7.2 million worth of oil a year at a cost of $5 million. “The economic life of this site will be about 30 years,” he said.

Wells Being Moved

Now that work has begun on Torrance’s Park del Amo residential and business development along Sepulveda between Madrona and Crenshaw Boulevard, Santa Fe Energy, which has 61 wells in the area, is relocating them to five walled sites under a plan approved by the city.

Over the years, the number of wells has decreased and production has declined as fields have begun to dry up. New drilling is confined largely to replacing existing wells, and exploring for new oil is unusual.

But the continued importance of oil production in the South Bay is reflected in the fact that the Wilmington field ranks No. 1 in the contiguous United States in combined past and potential oil production, according to the American Petroleum Institute. It ranks first in the state in cumulative production since its discovery--2.1 billion barrels. The Torrance field ranks No. 23 in cumulative production.

The Dominguez field in Carson, where old wells pump in open fields east of Califnrnia State University, Dominguez Hills, is No. 18. Although it was the site of a 1920s oil boom and pumped 721,218 barrels last year, the Dominguez Hills field is far less productive today than Wilmington or Torrance.

‘Good Lord Put Oil There’

“Wilmington’s a good field because the good Lord put oil there,” quipped William H. Garrison, engineering manager of Long Beach Oil Development Co., which operates 498 onshore wells tapping the Wilmington field within the Port of Long Beach.

On a more technical note, Garrison said the field is composed of sedimentary layers where oil is found and contains faults that serve to trap oil. Oil in South Bay fields lies in pools at levels between 2,000 and 10,000 feet beneath the surface.

The Wilmington field in 1984 produced 40.6 million barrels of oil--much of it offshore--while the Torrance field yielded 2.4 million barrels, according to the state. The most recent crude oil price bulletin issued by Chevron USA pegs oil from the Wilmington field at $21.60 a barrel and Torrance oil at $22.10. Pricing is based on the density of oil. The lighter the oil, the higher the price. Producers say local oil tends to be heavy and requires more refining than lighter, higher-quality oil, which yields more gasoline.

Garrison said such oil is less valuable, but this is not a roadblock to profitability.

For the most part, South Bay oil is piped from the field to refineries in north Long Beach, Torrance or the harbor area of Los Angeles. Most of what comes out of the refineries is sold locally.

Fields Declining

Sampson of Santa Fe Energy said he likes to think that some of the gasoline being pumped in Torrance filling stations came from the company’s wells in the Madrona Marsh area.

In the language of the oil business, all South Bay oil fields are declining because they are old, peaked years ago and are being pumped out. “There is just so much oil and getting it out is a matter of time,” said Garrison, adding that his company expects to operate profitably at the port for another 15 years.

But James Campion, senior engineer with the state oil and gas division, said terms like declining fields, together with oil maps that show numerous nonproducing wells, can be deceiving in the oil business.

“Whether an oil field is good is a matter of economics,” he said. “As long as some operators can operate wells economically, they will continue to do so.”

Oil Forced Out

In the Torrance and Wilmington fields, major operators now are using water injection to maintain well pressure and force more oil out. Because the oil is heavy, Garrison said, producers are looking at heat processes that would reduce thickness and enhance recovery.

Owning property where oil is being pumped does not guarantee a share of the profits. Mineral and oil rights do not automatically go to purchasers of property; previous owners frequently hang on to them and share in royalties.

“There are at least two owners for any plot, one on the surface and one below,” said Robert Samuelian, operating engineer with the state oil and gas division in Long Beach. Of the 5,000 owners who receive royalties from Exxon’s Wilmington operations, 1,600 are resident owners and the remainder are people who bought or retained mineral rights.

The newest, and most lucrative, portion of the Wilmington field is in the state-owned Long Beach tidelands, which was developed 20 years ago by Thums Long Beach Co. The name derives from the oil companies that formed the company--Texaco, Humble (now Exxon), Union, Mobil and Shell--to find and develop a new source of oil.

Thums pumps 74,000 barrels a day from 1,100 wells located on four offshore oil islands and a land site near the Queen Mary, according to company spokesman Steve Marsh.

State Paid Royalty

The state receives most of Thums’ profits, which were $425 million last year. Thums, however, recoups its operating costs, which include a $30-million annual payroll for 515 employees. Companies that formed Thums make a profit from selling the refined oil while most of the income generated by the crude product is paid in royalties, most to the state and some to the city of Long Beach.

In less productive fields such as Rosecrans and Howard Townsite in Gardena and South Los Angeles, small operators have taken over wells from major companies that originally drilled them but no longer find them economical to operate.

One of these people is Robert Shull of Seal Beach, who owns 16 “stripper” wells in the Rosecrans field. They are called that because they are low, but steady, producers that have been pumping for years and “stripping” oil from the ground.

Although he would not disclose figures, Shull said that as an individual operator, he can make a profit from his wells as long as they keep pumping.

His secret? “I don’t have to support a 40-story building in Dallas, or overhead, or research and development.”

PRODUCTION AND RESERVES IN BARRELS Field / date discovered Alondra (1946) No. of wells 1’84 production 1,701 Cumulative production 2,146,000 Reserves 100,000 Field / date discovered Dominguez (1924) No. of wells 126 ’84 production 721,218 Cumulative production 266,838,000 Reserves 10,900,000 Field / date discovered El Segundo (1935) No. of wells 6’84 production 39,942 Cumulative production 14,024,000 Reserves 140,000 Field / date discovered Howard Townsite (1924) No. of wells 17 ’84 production 50,434 Cumulative production 5,589,000 Reserves 574,000 Field / date discovered Hyperion (1944) No. of wells 1’84 production 10,915 Cumulative production 600,000 Reserves 100,000 Field / date discovered Lawndale (1928) No. of wells 2’84 production 7,788 Cumulative production 3,718,000 Reserves 127,000 Field / date discovered Potrero (1928) No. of wells 19 ’84 production 80,803 Cumulative production 14,730,000 Reserves 942,000 Field / date discovered Rosecrans (1925) No. of wells 69 ’84 production 251,923 Cumulative production 80,144,000 Reserves 3,195,000 Field / date discovered E. Rosecrans (1959) No. of wells 2’84 production 4,296 Cumulative production 193,000 Reserves 100,000 Field / date discovered S. Rosecrans (1939) No. of wells 15 ’84 production 35,338 Cumulative production 8,601,000 Reserves 234,000 Field / date discovered Torrance (1922) No. of wells 404 ’84 production 2,466,439 Cumulative production 204,517,000 Reserves 21,164,000 Field / date discovered Wilmington No. of wells 2,390 ’84 production 40,634,629 Cumulative production 2,151,603,000 Reserves 352,555,000 Source: Calif. Dept. of Conservation, Division of Oil & Gas