Coastal Activists Elated but Wary as Battle With Occidental Ends

For more than two decades, Occidental Petroleum Corp. Chairman Armand Hammer battled City Hall for the right to sink oil wells along the coast in Pacific Palisades, creating one political and environmental uproar after another.

But now that the philanthropist and self-styled diplomat is dead, his obsession appears to have died with him.

Oxy’s new chairman, Ray Irani, says the firm will not raise the issue again--a concession that left longtime opponents of the oil company’s plans both elated and surprised Friday, given the low-key way the company handled the matter.

Irani hoisted the white flag in what had become one of Los Angeles’ longest environmental disputes with a solitary sentence that could have easily gone unnoticed Thursday at the company’s annual shareholders’ meeting in Santa Monica.

“My decision is not to pursue it,” he said in response to a question from a shareholder, who asked for the status of the Palisades project. It was the last question and the last answer of the 90-minute session. Afterward, there was no press release.

Opponents of the company’s plans to drill on a two-acre site across Pacific Coast Highway from Will Rogers State Beach reacted with a mixture of elation and skepticism.

“If they are serious, the campaign appears to have ended with a whimper,” said Roger Jon Diamond, who 21 years ago helped organize a citizens group called No Oil Inc. “But given the history of the project, I don’t think we’re quite ready to disband.”

The Occidental chairman’s remarks appeared to dispel the company’s longstanding threat to continue fighting for the project by filing a lawsuit against Los Angeles over the passage of Proposition O. The measure, approved by voters in 1988, helped doom the project by repealing several earlier ordinances that would have allowed the drilling to take place.

Asked about the decision not to bring suit, company officials Friday declined to elaborate. Occidental spokeswoman Suzette Swalwell said the chairman’s comments “speak for themselves.”

For the company’s opponents, Oxy’s decision elicited the kind of jubilation ordinarily associated with battle-weary veterans.

“I can’t tell you how it warms my heart, what a joyous feeling it gives me to hear this,” said City Councilman Marvin Braude, who co-sponsored Proposition O, along with Councilman Zev Yaroslavsky. Both men said the decision vindicates years of hard work by community activists and environmentalists.

Throughout the years, drilling foes charged repeatedly that the project was an ego trip for Hammer, the company’s famous, globe-trotting chief, who died last December.

It was often suggested that, besides the Nobel Peace prize, there was nothing the celebrated industrialist and friend of world leaders may have coveted more than to see the Palisades project become a reality.

Braude, who met with Hammer numerous times to discuss the project, recalled Friday that “there was no question that it became something intensely personal for him.”

“I recall him saying once, ‘Marvin, if Sadat and Begin can get together and make a deal (between Egypt and Israel), why can’t you and I make a deal?’ ” the councilman said. “He had the feeling that it was just a matter of negotiating the right price. He couldn’t understand that the public interest was involved.”

As environmentalists reveled in the apparent victory Friday, some looked back on the struggle as a defining period of their lives.

“I was a young lawyer with two baby girls when the whole thing started,” said Diamond, reflecting on how No Oil Inc. got started in 1970. “By 1988, my girls were old enough to vote in the election.”

He marked both his 40th and 45th birthdays attending hearings over the project.

Sabrina Schiller, who works in a Century City law firm, recalled her volunteer work with the group while a law student in 1988 and how she was “absolutely convinced” that she and her environmentalist friends were doomed to lose.

“I remember telling fellow students how important it was to support Proposition O in class one day and the majority of them had it backward as to what a ‘yes’ vote meant,” she said. “I figured that with all the confusing TV ads, if these people couldn’t get it straight, the average voter wouldn’t have a chance. It was one time I was glad I was wrong.”

The oil drilling battle dates to 1966, when Occidental sought to drill in the Palisades area after discovering what the company said was up to 60 million barrels of oil beneath the wealthy community.

It was not a big find by world standards. Prudhoe Bay in Alaska, for example, has 9 billion barrels. But it would have been an unmistakable boon for the anemic company that Hammer took over in 1957 and transformed into a corporate giant.

Under his watchful eye, the firm spent millions of dollars over the years in a bid to persuade judges, politicians and the public that the oil beneath the Palisades could be extracted safely.

In the bitter 1988 campaign alone, Occidental dropped $8 million in the losing effort to defeat Proposition O, and win approval of Proposition P, its own initiative which would have allowed the project to go ahead. Environmentalists spent $3 million.

The company’s efforts, and those of the opponents, ebbed and flowed like the sea, with both sides experiencing victories and defeats in the battle over the oil. In 1973, for example, the company actually had erected a rig that was ready to bore holes into the Earth until a court stepped in at the last minute.

Said anti-drilling activist Diamond: “As someone who’s lived with this thing for a long time, I hope this means it’s all over.”