- Chevron on Tuesday said it expects asset values to decline by up to $4 billion in its fourth-quarter 2023 results, which the company blames in part on its strong California base, according to regulatory filings. It points to the environmental regulatory structure.
- Energy policy experts told the Daily Caller News Foundation that the impairment is a sign of trouble for California’s industrial sector as a whole.
- “Hundreds of small businesses are at risk in every aspect of oil and gas development, and sadly they are contributing to the state’s overall decline,” said the founder of energy advocacy group Power the Future. Director and Executive Director Daniel Turner told DCNF. “If major corporations aren’t willing to bow to Sacramento’s never-ending desire for regulation, how can we get small, family-run businesses with limited resources to comply?”
Chevron announced Tuesday that it could face a multibillion-dollar impairment charge due in part to California’s regulatory environment, but some energy policy experts told the Daily Caller News Foundation that the development said it could pose a challenge to the outlook for the state’s energy industry.
Chevron said it expects to incur up to $4 billion in asset write-down charges in the fourth quarter of 2023. This is an impairment partially related to oil and gas production in the United States, particularly California, which has strict environmental regulations. The company has emphasized in the past that according to For regulatory submissions. Energy policy experts told DCNF that the impairment charges are a troubling sign for California’s energy industry, adding to a trend that could potentially jeopardize tens of thousands of jobs in the state. He said other companies may follow suit. (Related article: How state regulators played a role in California’s rolling blackouts and wildfires)
“Chevron’s operations in California include a major refinery in Richmond, California, as well as upstream operations that produce heavy oil through steam injection in the central San Joaquin Valley of the state. California’s air quality regulatory structure and other “As operating regulations become increasingly strict, the costs associated with operating both have increased significantly and profitability has declined,” said the 40-year veteran of the oil and gas business, who now works as a regular oil and gas business. says David Blackmon, who consults and writes about the energy industry. he told DCNF. “The regulations in question apply industry-wide and impact any company seeking to do business in the state. Other operators are expected to announce similar impairment actions in the coming months…California. The oil industry’s struggles with regulation and the business environment mirror the state’s population as a whole. The massive exodus of people and businesses from California in recent years has been largely due to heavy-handed control by central planners. be.”
Gavin Newsom’s California reaches new milestone – $68 billion budget deficit https://t.co/M5b3dXJ9gl
— Daily Caller (@DailyCaller) December 9, 2023
California will be one of the nation’s leading states in oil production in 2022, with its operators pumping more than 124 million barrels of oil that year. according to Based on data from the U.S. Energy Information Administration (EIA). The state has seen a nearly 30% decline in local oil and gas production over the past four years. according to EIA data, energy independence trends for Californians attribute The main purpose is to “shut down production due to state and local energy policies.”
Chevron previously emphasized in state filings that California’s policies were hurting its business. “Two decades of policy choices have reduced supply elasticity and severely limited refiners’ ability to respond to price increases,” the company said. I have written In December, it provided comments to the California Energy Commission (CEC) regarding proposed state regulations.
“California policies make investing in Chevron’s home state riskier than investing in other states,” Andy Walz, Chevron’s president of products for the Americas, wrote in a November letter to state officials. He said the following: according to to Reuters. “Last year, we canceled several projects due to permitting challenges.
At the state level, California is widely considered to be on the leading edge of the world. climate change policy, according to To the state line. Moving away from regulations focused on oil and gas production, the state has pushed for aggressive regulation of electric cars and trucks, and has intentionally challenged Chevron and other oil majors to educate the public about the nature of climate change. filed a climate change lawsuit for trying to mislead; enacted Groundbreaking corporate emissions disclosure requirements.
California’s local oil and gas production supports an estimated 50,000 jobs across the state, including 31,000 jobs in the economically depressed San Joaquin Valley. according to For Californians seeking energy independence.
“Hundreds of small businesses are at risk in every aspect of oil and gas development, and sadly it is contributing to the decline of the entire state. How can small, family-run businesses with limited resources comply with regulations if they are not willing to give in to greed?” Danielle, founder and executive director of energy advocacy group Power the Future Turner told DCNF. “Over time, oil states that value hard work and expertise will lose talent to the oil fields and many companies will go out of business for good. All of this is reversible, all of this is preventable. “And, sadly and completely foreseeably, California is pursuing these radical policies despite the devastation it will bring to the state.”
Neither Newsom’s office nor the CEC immediately responded to requests for comment.
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