California oil merger set to benefit from permitting boom

By Nathan Risser Bloomberg California Information Corporation which is set to take over rival oil driller Berry Corp stands to benefit from state law that would make it easier to drill California Tools disclosed a million all-stock deal Monday to buy Berry days after California legislators passed state bill which will allow oil-producing Kern County to issue as numerous as new permits per year The bill marks a sharp shift from years of regulatory scrutiny by the state s lawmakers toward its oil and gas industry and decades of declining in-state crude production Related Articles California Legislature passes a swath of last-minute potency bills California s biggest inland oil pipeline on curriculum to shut imperiling shipments to Bay Area refiners Last-minute bill aimed at boosting California oil production introduced California in talks to pay hundreds of millions to Valero to stave off Bay Area refinery shutdown Elias California must do better to make Big Oil pay for weather change It s really a truly notable change California Guidance CEO Francisco Leon disclosed Monday on a call with analysts discussing the acquisition The state is signaling a need for California production he stated adding that the company has been having tremendous very constructive conversations with the state of California Shares of California Guidance gained as much as Monday the largest intraday rise in almost two months Roth Capital Partners raised the target price on the company Monday to from Jefferies analysts stated in a Monday note that there is undeniable industrial logic to the merger of the two companies Newsom has days to sign the bill after which Kern County would have the authority to issue new permits effective January They re ready to go Leon announced on the call noting that Kern County has been staffing up on the permit front Boosting oil production is seen by the bill s sponsors and the California Force Commission as a means of mitigating gasoline price spikes following decades of refinery closures California Materials expects to be a major participant in the new annual permits and have their own staff ready to go explained Leon We have permits ready to be filed several of the already have been filed he mentioned Environmental groups have criticized SB and what they see as broader walkbacks in California s environmental protections Removing environmental safeguards won t reverse the terminal decline of California oil production but it will allow the industry to do more damage on its way out the door stated Hollin Kretzmann an attorney at the Center for Biological Diversity s Circumstances Law Institute This bill would mean more air water and greenhouse gas corruption while having no impact on refinery closures or gas prices More stories like this are available on bloomberg com Bloomberg L P