The Role of Independent Oil and Gas Companies in California's Changing Marketplace

Abstract

Abstract As the major oil companies divest properties in California, the role of independent oil companies grows in importance. California is one of only two states in the country where the major oil companies dominate drilling and production. It is important for the major oil companies to have a strong, vibrant independent presence. A healthy independent oil and gas presence in California assures the majors of the following in their divestment programs: Financially capable companies to assume plugging, abandonment and environmental liabilities; Responsible acquisition companies to assure that the major's reputations remain intact; and a competitive market place. Independents have traditionally been risk takers in other producing areas, often leading exploration and development efforts and new technologies. A greater number of independents also assure more innovation in California's oil and gas operations. This paper documents the efforts of California independents over the past decade as they have successfully filled the void left by the major oil companies divestment of California properties. Further, it is demonstrated that the health of the oil and gas industry in California has improved by the emergence of these innovative and progressive California independent oil and gas companies.