Three related companies that operate a drilling site within Los Angeles City limits filed a lawsuit in California Superior Court challenging the City’s decision to adopt an ordinance making oil wells a nonconforming use, banning the drilling of new wells, and prohibiting maintenance, drilling, re-drilling, or deepening of existing wells. The companies also challenged the City’s related adoption of a Mitigated Negative Declaration and Mitigation Monitoring Program under CEQA. The companies asserted that the City’s actions violated CEQA and the City’s General Plan (which they alleged “clearly contemplates the continued responsible extraction of oil and gas in the City”), and that the actions constituted a taking without just compensation and violated due process under the California and U.S. Constitutions. The companies alleged that the City failed to analyze how the ordinance would increase importation of oil and gas to meet existing demand and therefore lead to increased emissions from oil tankers and trucks used for oil transportation, and that the City ignored the environmental impacts of plugging and abandoning wells. The companies further alleged that they had invested in the conversion of their own operations to 100% electric in order to obtain City approvals to operate the site, and had relied on City approvals when investing in future development at the site.

Oil companies' challenge to Los Angeles ban on drilling.

Warren E&P, Inc. v. City of Los Angeles

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Oil Companies Challenged Los Angeles Drilling Ban Ordinance

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Oil Companies Challenged Los Angeles Drilling Ban Ordinance

Policy instrument

Risk

Impacted group

Just transition

Fossil fuel

Greenhouse gas

Economic sector

Finance