California Farmers Alarmed as Energy Companies Outbid Ag Water Districts for Resource


Posted on 06 February 2013

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By Dan Aiello

There's a new water interest bidding for California's limited water supplies, and the managers of California's historic agriculture-centric water districts in the Central Valley aren't smiling.

With a finite supply of water, Sacramento may have to choose between expanding food production or fracking wells and oil and natural gas production. Either option will likely lead to increases in food or energy costs for consumers.

Out-of-state, (primarily Texas-headquartered) energy companies with deep pockets from record profits and the strongest lobby in Sacramento are anxious to extract as much severance tax-free California oil from the ground as quickly as possible.

Anticipating that a Democratic two-thirds majority could finally mean an end to their decades long free ride they spent so much political action money achieving, not just Exxon/Mobil, but Texaco, Chevron and British Petroleum are all outbidding agricultural water interests by a 3-to-1 margin.

For California farmers, the loss of hundreds of thousands of acre feet of water from the districts means an increase in rates and fewer acre feet allotments intended for new groves of pistachios and almonds, vineyards of grapes and fields of water-intensive alfalfa, tomatoes and corn, that likely will be planted either without increases in acreage or an increase in fallowed fields this year.

According to state ag business analysts, the energy companies' water grab will likely translate to higher food prices for consumers and increased cost to the production of bio fuels like ethanol that rely on the availability of cheap and abundant corn harvests.

Agriculture water districts from Modesto to Maricopa are reportedly alarmed by the purchasing power of energy companies who are buying up as much water as they can with financial resources traditional agriculture water districts can't match - as much as three times the rate water districts expected to pay.

In Kern county, along Paso Robles Hwy 46 between Bakersfield and the I-5 interchange, Aera Oil's Kenai Fracking Rig #7 operations, hidden behind a 12-foot solid green wall patrolled by two security guards to prevent public observation of the operations, is busy pumping 1.46 million gallons of California aqueduct water, along with chemicals, steam and sand under high pressure into the soil every week in hopes of bubbling to the surface the remains of Kern's depleted oil deposits in a controversial extraction method known as hydraulic fracturing or "fracking."

Fracking is controversial for many reasons.

It has been proven to contaminate local groundwater in Kern, killing acres of almond trees in a single watering after Aera executives chose to ignore state regulations for lined ponds to hold the "produced" wastewater much as Pacific Gas and Electric's decision in the movie Erin Brockovitch in Hinckley and Kettleman City. While the industry is regulated by the state and Governor Jerry Brown, Jr, a Democrat, has proposed new regulations, the state, without a severance tax on removal of its finite oil reserves, does not have the funds to hire adequate numbers of field inspectors for an industry known to have an arrogant disregard for environmental concerns.

Because California's mineral rights are sold separately from land rights, environmentalists say the dye is cast for the contamination of groundwater supplies and fertile farmland as those who own the oil deposit rights, primarily out-of-state oil interests, have little regard for what happens to the land above or water below.

Financial gain from extraction of California's remaining oil reserves is too great right now while destruction of the water and land has no financial cost to mineral rights owners.

California once ranked 2nd in oil production but Kern Long Beach oil fields (Kern County oil fields alone once provided a third of all US domestic oil production) have been depleted - without any royalties to the state for decades - to such an extent the state in 2011 barely ranked 4th.

In Kern County, still the largest oil producing county in California, fracking wells have already consumed 2.8 trillion gallons of potable drinking water from the aqueduct. This industrial use of the water was never envisioned or allotted for by the State's Department of Water Resources or State Water Project.

Northern Californians, as in 1960 when all northern counties except Butte opposed the aqueduct, still recall the promise made by then Governor Edmund G. Pat Brown, that the aqueduct was the "permanent solution to the state's water woes." But as the only western state not to have a Department of Managed Growth, Sacramento governs by reaction to dire population forecasts without a plan to control or manage growth, establish greenbelts between communities or account for quantities of finite resources like water in order to balance economic concerns with preservation of the state's quality of life, natural wonders and wildlife.

Anti-fracking groups have seized upon the water use and its subsequent contamination (it takes up to 8 barrels of water to produce 1 barrel of oil - California currently produces about 240 million barrels of oil annually) to point out that in the extinct Cedar forests of Lebanon or the lost tropical jungle of Easter Island, governments who fail to recognize environmental mistakes too late can embark on irreversible paths that are only beneficial short-term.

Before gold, before movies, before high-tech, even before oil, California was known for agriculture. The agriculture heritage of the Central Valley, of Napa, of Santa Clara, even once of Orange, made the state known as the land of milk and honey, fruit and nuts. The greatest concern of the state's environmental groups (underfunded and understaffed compared to the oil and gas and chemical industries) like Environmental Defense Fund, or the Bay Delta Conservation League, is the short-sightedness of a term-limited legislature and a public under the misguided assumption that California is a "green," "pro-environment," or "tree-hugging" electorate.

Apathy about fracking in California surprises New York and Pennsylvania environmentalists, who enjoy huge numbers of protestors at anti-fracking rallies. Even the long-held political belief San Francisco voters were environmentally sensitive and "green" was dashed in November when an overwhelming 73 percent essentially spit on the legacy of John Muir when they voted to retain the Hetch Hetchy Valley as the city's cistern when nationally dams are being removed in countless numbers for the destructive effects they have had on the environment.


Dan Aiello reports for the Bay Area Reporter and California Progress Report.