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California moves to ban fracking permits in state by January 2024

Highlights

State utilities consume 5.5 Bcf/d year to date

Sierra Club says ban not enough

California Governor Gavin Newsom has directed state regulators to ban permitting for fracking for oil and natural gas wells by January 2024 to help the state achieve its required greenhouse gas emission goals.

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Additionally, Newsom requested the California Air Resources Board to phase completely out oil and gas extraction across the state by no later than 2045. The announcement by the governor's office was made April 23.

CARB is required to achieve carbon neutrality by no later than 2045.

"The climate crisis is real, and we continue to see the signs every day," Newsom said. "As we move to swiftly decarbonize our transportation sector and create a healthier future for our children, I've made it clear I don't see a role for fracking in that future and, similarly, believe that California needs to move beyond oil."

Megan Bloomgren, senior vice president of the American Petroleum Institute, called Newsom's announcement "bad policy masquerading as climate progress. With the second highest energy use in America, California needs more energy options, not fewer, as county populations grow," she said in a statement.

Total California gas demand has averaged 4.6 Bcf/d month to date and 5.5 Bcf/d year to date, according to data by S&P Global Platts Analytics. The state currently produces 383 MMcf/d of gas and 376,000 b/d of oil. The state averaged eight active rigs during March 2021.

On April 12, a California state bill which would have required a 2,500-foot setback between oil and gas wells and homes and schools, died during a senate committee vote.

"California oil and natural gas operators follow the strictest regulations on the planet and efforts to shut down domestic production will only worsen the state's reliance on environmentally inferior foreign oil tankered here from Saudi Arabia and South America," said Rock Zierman, CEO of the California Independent Petroleum Association, in a statement. "Foreign oil is not produced with the same environmental protections or humanitarian values that we have here in California; nor do they pay billions in California taxes or hundreds of millions of dollars in fees that are reinvested to advance California's climate goals."

But Newsom's April 23 order fell short for some environmental groups.

"California needs prompt state action to confront the climate crisis," Brandon Dawson, acting director of Sierra Club California. "This means shortening the timeline for the fracking ban and requiring the phase-out of oil and gas production earlier. And glaringly absent from the order: a statewide setback rule. Setbacks from oil and gas wells are necessary to protect the health and safety of frontline communities."