The Los Angeles city council has voted to eliminate new oil and gas wells in the city, and phase out existing production over five years.
This follows a motion from LA County to eliminate new well drilling, that was passed late last year, bringing an end to a number of fields producing since the 1920s.
The County produces ~50kb/d, with California Resource Corporate (NYSE:CRC) producing ~20kb/d in the basin; CRC’s total production volume was 102kboe/d last quarter.
CRC is a pure-play California producer, that was spun out of Occidental (NYSE:OXY) amidst the 2014 oil-price downturn, the Company has since filed bankruptcy but emerged during the pandemic and was up 80%+ in the last year.
California fossil fuel policies have been a major headwind for the operator, but this appears to be the most impactful decision yet by regulators in the State.