State Issues $2.7 Million Penalty to Chevron for Violations in Kern County Oil Field

SACRAMENTO October 3, 2019 – California oil and gas regulators today issued a civil penalty of more than $2.7 million to Chevron for numerous violations at the Cymric Oil Field in Kern County.

The field has been the site of several “surface expressions” – water, steam and oil forced to the surface, likely as the result of cyclic steam operations. Surface expressions became illegal under new regulations adopted by the Department of Conservation’s Division of Oil, Gas, and Geothermal Resources (DOGGR) and effective April 1, 2019.

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The Civil Penalty Order notes that Chevron allowed a series of surface expressions to occur at the Cymric field on at least four occasions between May 10 and July 22. DOGGR previously issued several corrective documents to the operator. Factors considered in calculating the penalty amount include:

  • The extent of harm caused. The order says the surface expressions created “a significant threat of harm to human health and the environment.”
  • The pervasiveness of the violations. As of August 1, oil from the four surface expressions flowed into 41,947 square-feet of a dry streambed.
  • Ensuring the operator does not realize any economic benefit because of the violations. The order estimates the total fluids recovered from the surface expressions at Cymric enabled Chevron to sell about 7,129 barrels of oil, with an estimated economic benefit of approximately $399,231 from the incident.

Depending on the severity of a violation, an operator can be assessed up to $25,000 per day per violation. Fines collected from oil and gas operators go into an Oil and Gas Environmental Remediation Account created to help address impacts caused by noncompliance. The State Oil and Gas Supervisor also may allow an operator to direct up to 50 percent of its total fine toward supplemental environmental projects (known as SEPs) that benefit communities impacted by oil and gas production.

This is the second-largest fine issued under DOGGR’s recently created Office of Enforcement. In January 2019, DOGGR issued a $5.076 million fine against HVI Cat Canyon, Inc. for violations related to its operation of the Richfield Oil Field in Orange County.