Air Pollution Clouds Economic Environment

David Nott argues that environmental rules and taxes are driving gas refiners out of California (“Jolted by Gas Prices? Don’t Be Too Quick to Cuss the Refiners,” Commentary, June 29). “Life moves on, and so will businesses in this overly regulated climate.” The problem with California’s climate is, in fact, air pollution. After 30 years of steady improvement, air quality in Southern California is once again deteriorating rapidly. Smog and diesel particulate matter far exceed federally mandated thresholds, and they’re to blame for a growing epidemic of asthma and other respiratory ailments.

In the long run, filthy air will do much more than make individuals gasp for breath; it will choke California’s entire economy as successful companies and their skilled employees locate in regions where the sky is blue, not brown. That’s the exodus we need to worry about.

Daniel S. Hinerfeld

Natural Resources Defense

Council, Santa Monica

As Nott says, all the environmental restrictions and the high taxes in California make it hard for oil companies to build new refineries, but there is an even more important reason: the lack of oil supply for the new refineries. Because a new refinery costs about $1 billion, no one will build one unless he can be assured of an oil supply over the next 20 years. With declining U.S. production, no one can do this.

Oil producers in Saudi Arabia can provide oil for a new refinery, but they are happy to sell us gasoline and jet fuel from their refineries. That way they make the profit on both the oil production and the refining plus the profit they make by shipping it in their tankers.

Robert C. Mason

Simi Valley

It’s been reported in this paper that the profit margin of refineries in California is much higher than that of refineries in the rest of the nation, and on April 6 your paper reported, “The Bakersfield refinery, though less efficient than other Shell plants, was profitable in 2003 and has the highest margins of Shell’s eight U.S. refineries, according to internal documents obtained by The Times.”

I was surprised, then, to read Nott’s Op-Ed article about the hand-to-mouth existence of our beleaguered oil companies, laid low by those odious environmental regulations and forced to close refineries rather than bear the cost of compliance.

Now, I have owned a few clunkers in my time, and I know how it can be when repairs are nickel-and-diming you to death. Sometimes when you can’t financially justify fixing a car, you donate it to charity. Maybe Shell should just hand over the keys of the refinery that it wants to close to the people of the state. Take the tax write-off to help offset those record profits, and we’ll run the refinery as a nonprofit and bear the cost of getting it “smogged.” Think they’ll go for the deal?

Jim Sevin

La Mirada