American Oil and Gas Reporter - June 2022 - 43

IssuesUpdate: California Independent Petroleum Association
CIPA Carries On Despite
Governor's Hostility
By Del Torkelson
SACRAMENTO, CA.-The leadership
at the California Independent Petroleum
Association has been in place long
enough to offer firsthand perspectives
about how things have evolved for the
group over time.
CIPA Chief Executive Officer Rock
Zierman has been the group's top staff
member for a couple decades, and as he
considers the setting in which the state's
oil and natural gas producers find themselves
in early summer 2022, he perceives
a starkly different landscape. Governors
from both parties, from Pete Wilson to
Gray Davis, Arnold Schwarzenegger to
Jerry Brown, have come and gone. Although
their ideologies and political inclinations
covered a broad spectrum, Zierman notes,
those administrations all nevertheless
showed a willingness to work with CIPA,
even if the negotiations were tough.
Unfortunately, he reports, since Gavin
Newsom became governor in 2019, there
have been no such discussions. " In my
20 years at CIPA, I have dealt with a lot
of governors and regulators, and it has
been very rewarding to solve problems,
whether through legislation, the courts,
elections or other avenues, " Zierman recounts.
" Much of that was achieved through
negotiations and discussions among adults
in the room, and CIPA accepted a lot of
new rules and regulations to get there.
" Those conversations are not happening
anymore, because this governor is not
interested, " he continues. " This is the
only governor in California history to
not meet with the oil and gas industry
(aside from Chevron). There are no problem-solving
conversations. Instead, the
administration is taking advantage of
Covid to hunker down, be unresponsive,
reject in-person meetings and drag out
permitting in a never-ending process with
unclear criteria that change every day. "
CIPA Chairman Steve Layton has held
his position at the association for more
than six years, and in that period, he says
he also discerns a stark difference. Although
California producers faced no
shortage of challenges when he took the
" I believe a lot of companies have ready-todeploy
investments that have been on the shelf
because of a lack of permits. Those projects
were economic at commodity prices that were
a lot lower than current ones, so California still
can turn this production decline around. "
-Steve Layton
CIPA Chairman
helm in the middle of the previous decade,
Layton reflects, discussions about hydraulic
fracturing regulations, underground
injection permits and tax policy did not
fundamentally threaten the industry's very
existence.
" The issues we face now pose immediate
threats to our ability to operate, "
contrasts Layton, president of E&B Natural
Resources in Bakersfield, Ca. " We faced
challenges back then, but the possible
consequences of losing are far more
severe now. It is a difference between
enduring changes that make life more
difficult and expensive, to the sort of
stakes where losing means the end of oil
companies' ability to exist in California.
Today, there is nothing covert about the
orchestrated efforts to shut us down. "
Avowed oil and gas opponents, whether
elected officials or voices in the public
square such as the state's powerful green
lobby, tend to portray their anti-industry
motivation as fighting greenhouse gas
emissions, but Zierman says a closer look
at their actions suggests otherwise. Whether
it is the state's inability to meet any of its
official climate benchmarks, or anti-development
groups' resistance to oil and
gas companies' participation in carbon
capture and sequestration or renewable
natural gas projects, the evidence points
to a more straightforward calculation.
" It is virtue signaling, " Zierman assesses.
" It has nothing to do with the environment
and everything to do with politics.
They see us as their enemies. "
Stubborn Facts
John Adams once held that " facts are
stubborn things, " and both Layton and
Zierman express hope reality eventually
will override rhetoric.
Layton points out that rising consumer
energy prices, exacerbated by Russia's invasion
of Ukraine, have made Californians
more receptive to CIPA's message. " Now
we are getting traction with things we have
been saying all along, " he reports. " In the
last six months, we have seen a much
greater interest in listening to the facts. "
Although rank-and-file Californians,
the media and even many elected officials
have shown more willingness to
listen, Zierman says the Newsom administration
continues to tune the message
out. Even as crude oil prices have
exceeded $100 a barrel for most of the
spring, Zierman points out that the governor
continues to tout his status as a
thorn in the industry's side.
" There is a lot of interest to drill and
increase production, but production is
down 20% and counting under this governor, "
Zierman reports. " He wants to say
'I took out the domestic oil and gas industry.'
He is not going to complete the
sentence to add 'and I replaced it with
imports from Vladimir Putin and the Amazon
rain forest,' but that is a fact. "
And CIPA is doing its part to make
sure that stubborn fact is proclaimed from
the rooftops. " We are taking some actions;
there are some billboards up to make sure
the public knows the actual ramifications
JUNE 2022 43
American Oil and Gas Reporter - June 2022

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