Lagoon Pact Won’t Delay Pipeline Start

Pacific Texas Pipeline Co., which wants to build a $1.66-billion oil pipeline from Los Angeles Harbor to Midland, Tex., persuaded the state Coastal Commission on Tuesday to allow construction of the project to begin before an environmental review is completed on restoration work proposed for Batiquitos Lagoon in Carlsbad.

The Long Beach-based company agreed in March to pay for enhancement of the lagoon to offset environmental damage that the pipeline project is expected to cause in Los Angeles Harbor, but company officials said Tuesday that they never agreed to delay construction of the pipeline until after the environmental review.

Company spokesman Charles Greenberg said such a requirement would jeopardize the entire pipeline project because of costly delays caused by government agencies involved in the Batiquitos cleanup. Greenberg said the company has been waiting for two years for the various agencies to agree on a mitigation program.

“The public agencies cannot move forward at the pace required for the PacTex project to proceed,” Greenberg told the commission.

The various state and local agencies involved in the Batiquitos project have been engaged in recent months in a bureaucratic tug-of-war with the billionaire Hunt brothers of Dallas, who own about two-thirds of the lagoon.

State officials say the land must be publicly owned before the restoration work, let alone the environmental review for the project, can begin. But officials with Hunt Properties Inc. say they will relinquish their lagoon lands only when Carlsbad and the Coastal Commission grant final approval for a 1,000-acre resort and housing project planned for the north shore of Batiquitos.

In a report submitted Tuesday to the Coastal Commission that formalized the panel’s decision last March to conditionally approve the Pacific Texas project, the commission staff asserted that the environmental review for the Batiquitos project was a prerequisite to issuance of the coastal permit needed for construction. Peter M. Douglas, executive director of the commission, said that Pacific Texas was “avoiding and lessening the conditions” of the approval by sidestepping the environmental review.

But after a lengthy and sometimes heated discussion, the commissioners sided with the pipeline company, agreeing to amend the staff report so that the environmental review would not hold up the construction permit for the pipeline, which company officials hope to begin early next year.

Eager to distance themselves even further from the ups and downs of the lagoon project, Pacific Texas officials told the commission that they will return with a proposal next month that would separate the two projects.

Cecil Owens, president of Pacific Texas, proposed that the company place $15 million in a trust account prior to construction of the pipeline so that the state could move ahead with restoration of the lagoon “at its own speed,” while Pacific Texas proceeds according to its own timetable with the pipeline project.

Carlsbad officials expressed relief that the Coastal Commission had given a green light for Pacific Texas. If the pipeline project had been blocked, it would have meant the $15 million for the Batiquitos restoration work would have evaporated.

Nonetheless, both sides in the Batiquitos dispute still appear to be far apart. The Hunts have, so far, refused to budge from their insistence that their project be given approval before they turn over the land. In the meantime, the firm’s leaders plan next Tuesday to go before the City Council to ask that planing for their project be expedited, a request the council rejected last month.

Times staff writer Eric Bailey contributed to this story.