Trends in heavy oil production and refining in California

Abstract

This report is one of a series of publications assessing the feasibility of increasing domestic heavy oil production and is part of a study being conducted for the US Department of Energy. This report summarizes trends in oil production and refining in Canada. Heavy oil (10{degrees} to 20{degrees} API gravity) production in California has increased from 20% of the state's total oil production in the early 1940s to 70% in the late 1980s. In each of the three principal petroleum producing districts (Los Angeles Basin, Coastal Basin, and San Joaquin Valley) oil production has peaked then declined at different times throughout the past 30 years. Thermal production of heavy oil has contributed to making California the largest producer of oil by enhanced oil recovery processes in spite of low oil prices for heavy oil and stringent environmental regulation. Opening of Naval Petroleum Reserve No. 1, Elk Hills (CA) field in 1976, brought about a major new source of light oil at a time when light oil production had greatly declined. Although California is a major petroleum-consuming state, in 1989 the state used 13.3 billion gallons of gasoline or 11.5% of US demand but it contributed substantially to the Nation's energy production and refining capability. California is the recipient and refines most of Alaska's 1.7 million barrel per day oil production. With California production, Alaskan oil, and imports brought into California for refining, California has an excess of oil and refined products and is a net exporter to other states. The local surplus of oil inhibits exploitation of California heavy oil resources even though the heavy oil resources exist. Transportation, refining, and competition in the market limit full development of California heavy oil resources.