As the City of Richmond and Chevron prepare to engage over an amended conditional use permit that would allow modifications to the Richmond Refinery, the pre-engagement posturing is playing out in the media.

Chevron just can’t understand why the community won’t embrace with alacrity their project to “improve reliability, enhance production of cleaner burning fuels and increase energy efficiency.”

Working backwards, that quote, which is copied below, came from a letter published in yesterday’s West County Times from Joe Sparano, President of the Western States Petroleum Association, an organization based in Sacramento that represents 36 petroleum and gas industries. Ironically, the letter was published under the heading “From the Community.” Excuse me, what community exactly does Sparano hail from? Oh, thank you --- the oil and gas community.

Sparano’s appeal ostensibly was in response to an earlier op-ed piece by Richmond’s Mayor Gayle McLaughlin (also copied below). Sparano begins with: “It is unfortunate Richmond's new mayor recently made disapproving comments about the project (Richmond must insist that Chevron do better, guest commentary, Aug. 11), as that is a regrettable posture to take toward the city's largest employer, taxpayer and provider of energy.”

On August 26, former Times writer John Geluardi’s final article that actually came after his departure, noted, “ The relationship between the Chevron Richmond refinery and the city has had its ups and downs during the past 102 years -- with more downs than ups as of late, city leaders say.”

The EIR for the Chevron expansion project is perhaps fatally flawed, having been sent back to the author for major surgery. Among those criticizing the document was California Attorney General Jerry Brown, resulting in a state budget delay. See $839,000 For a Fatally Flawed EIR?, July 21, 2007 and State Budget Impasse Linked to Chevron EIR, July 26, 2007.

Maybe the first shot in this media war was fired by Mayor McGlaughlin during an interview on KPFA on June 28. Chevron was invited to participate in the program but declined, instead sending a letter that exalted the benefits of the expansion project. For whatever reason, Chevron has never been able or willing to back up the claims made in that letter. See Chevron Unable to Back Up Claims Made in Letter to KPFA, July 21, 2007.

The essence of this project is that the Chevron expansion will be good for Chevron and its shareholders and may provide some benefits for people who buy Chevron fuel in the future. It has not been shown that there will be any benefits for people who live in Richmond, and in fact, it appears that the health, safety and perhaps economic interests of Richmond residents and others proximate to the Chevron refinery will be adversely affected. Chevron has never addressed these issues honestly and forthrightly. Will there be a frank discussion, or will Chevron simply  continue to posture and play victim?

JOE SPARANO

From the community

Can't afford to waste time

Contra Costa Times
Contra Costa Times Article Launched: 08/31/2007 03:06:49 AM PDT

Chevron's Richmond Refinery's Renewal Project seeks to improve reliability, enhance production of cleaner burning fuels and increase energy efficiency. It is unfortunate Richmond's new mayor recently made disapproving comments about the project (Richmond must insist that Chevron do better, guest commentary, Aug. 11), as that is a regrettable posture to take toward the city's largest employer, taxpayer and provider of energy.

Californians are facing some difficult challenges when it comes to the supply and demand for transportation fuels.

Criticizing Chevron -- or any other company trying to improve its facility and keep up with the rising demand for those fuels -- isn't going to help overcome the challenges.

California consumers already pay some of the highest gasoline prices in the nation, in part because of the stringent environmental requirements imposed on California refiners, according to the California Energy Commission (CEC) and the California Air Resources Board (CARB).

California also has seen a decline in the number of refineries in the past 30 years while the state's population has skyrocketed.

The remaining refineries have made investments to increase their efficiency while operating safely and reliably, providing this mobile market with critical supplies of cleaner-burning transportation fuels.

Those refineries operate in a highly regulated environment, meet strict environmental and product quality standards and have dramatically reduced emissions in the past 20 years.

They've done all this by investing billions of dollars in equipment and technology to improve reliability and efficiency.

Our industry recognizes the need to diversify energy supplies and to include a portfolio of alternative and renewable fuels and increasingly efficient technologies.

California refiners have been investing aggressively in those areas but now find themselves confronting another challenge -- to reduce carbon emissions as part of California's climate change initiatives.

California has embarked on an ambitious path to implement the Global Warming Solutions Act (AB 32) adopted by the Legislature late last year. And, the governor has ordered a new Low Carbon Fuel Standard (LCFS) for transportation fuels.

Our industry is fully engaged in and committed to the successful implementation of both initiatives.

The challenge for California is accomplishing these two giant tasks without unnecessarily impacting transportation fuel supplies or damaging the economy, and possibly causing financial hardship for consumers.

The current replacement effort at Chevron's Richmond refinery presents a wonderful opportunity for the city of Richmond and for California.

The project, which is currently in the permitting process with the city, will allow the refinery to increase supplies of California reformulated gasoline.

Some, including Mayor McLaughlin and California Attorney General Jerry Brown, say projects like that planned at the Richmond Refinery should be delayed until they demonstrate specifically how they will address global warming impacts, despite the fact that regulations on how facilities like refineries are to address the challenges of climate change have not yet been introduced.

CARB, the CEC and other agencies are currently examining scientific data, research and expert advice to determine the most cost-effective ways of reducing and mitigating climate change, as required by AB32.

These experts' plans for mitigation and the regulations to comply with AB32 have not yet been developed.

It is counter-productive and unfair to California consumers to delay or prevent investments for additional gasoline supplies while the experts decide the most effective ways to address climate change.

We can't afford to waste time, resources and community goodwill on unnecessary and unproductive criticisms of industries and companies that are willing to invest in our communities and in a cleaner environment.

Sparano is president of the Western States Petroleum Association.

Chevron, Richmond ties grow shaky

By John Geluardi

STAFF WRITER
Contra Costa Times

Article Launched:08/26/2007 03:05:16 AM PDT

The relationship between the Chevron Richmond refinery and the city has had its ups and downs during the past 102 years -- with more downs than ups as of late, city leaders say.

Their interests are closely intertwined: Richmond relies on Chevron as its largest taxpayer, and the refinery, which processes more crude oil than any other refinery in the Bay Area, needs its 2,900 acres on the city's western shoreline to produce a variety of diesel, gas and jet fuels.

As Chevron pursues its Energy and Hydrogen Renewal Project -- an equipment upgrade that will enable the refining of high-sulfur crude oil and the possible increase of greenhouse gas emissions, according to the draft environmental report -- some Richmond leaders are saying the relationship has become strained. Among the reasons are Chevron's decision to reduce its utility tax by $4 million annually with no explanation, an ongoing appeal to reduce its property tax, and its decision not to allow a section of the Bay Trail to be built on refinery property.

"I would like to see our working relationship be better," City Manager Bill Lindsay said. "There are a lot of issues we share an interest in, and I would like to see us have a broader conversation about the future of Richmond."

Chevron officials play down the perception of a strained relationship and point to the $1.2 million the company provides for city programs, nonprofit groups and educational scholarships, and that the refinery is the city's largest and most consistent taxpayer.

"We are part of this community and have been here for a long time," Chevron spokesman Dean O'Hair said. "We have an interest in helping them succeed in those areas the community wants to succeed in -- education, job training and safer streets."

But City Council veteran Vice Mayor Nat Bates said he detected a change in the relationship with the refinery in 2004, when the city was in the midst of a $35 million budget crisis. Bates sent an e-mail to Chevron Chief Executive Officer David O'Reilly at the oil giant's corporate headquarters in San Ramon, asking whether Chevron would advance a portion of its property tax so Richmond could avoid cutting city jobs and services.

"I would have understood if he said, 'Sorry, but we're going in another direction,'" Bates said. "But I didn't hear from him and didn't hear from him, and finally Dean O'Hair called me and said he spoke with O'Reilly and the city was to go through him."

Bates acknowledged that he has seen improvement in recent months and is hopeful that will continue.

O'Hair said he did not recall speaking to Bates about the property tax request, but he does remember former City Manager Isaiah Turner sending a similar letter.

"It was suggested he contact the folks here," O'Hair said. "I don't believe we were ever contacted further."

Another blow from Chevron came in 2006. With the city still recovering from the budget crisis, the refinery exercised its option to change the method used to calculate its utility users tax. The new "actuals" method -- based on a percentage of energy usage rather than a set rate -- reduced the refinery's annual payment from $14 million to $10 million. The loss of revenue delayed critical road-repair projects and slowed the city's general recovery.

Chevron has yet to substantiate the tax reduction with its energy use data, claiming trade secrets, though company officials have been working with the city to reach an agreement.

O'Hair said Chevron decided to change its calculation method when Gayle McLaughlin, who then was a council member and is now mayor, and Councilman Tom Butt suggested that the refinery -- which generates much of its own energy -- was paying less than its fair share.

"They raised the issue," O'Hair said. "And we decided to switch because everyone was paying actuals."

Butt said to blame the payment reduction on him and McLaughlin is "ridiculous."

"They've always had the choice of how to calculate that tax, and for them to blame it on somebody else is just preposterous," Butt said. "And who gets away with just reducing their tax without saying why? If you or I cut a check for $100 to the IRS without any other information, they'd throw us in jail."

Another sore spot is a gap in the Bay Trail, a continuous 400-mile recreational corridor that one day will encircle San Francisco Bay. The portion of bicycle and pedestrian path in question would connect Richmond's populated areas with scenic Point Molate, an undeveloped section of the city's western shoreline.

A 2001 engineering study determined that the best route is along the south side of Interstate 580 on Chevron property. The trail would pass over several large pipes that carry millions of gallons of oil products to and from tankers moored at Long Wharf. The estimated cost to construct the trail at the time of the study was $5.7 million.

Chevron, which participated in and partially funded the study, has since declined to allow access for the Bay Trail link, basing its decision on a U.S. Coast Guard recommendation made after the Sept. 11, 2001, terrorist attacks.

The issue gained attention in September after a bicyclist was killed and another seriously injured when they were struck by a car driving along I-580 that drifted into the existing bicycle lane on the freeway's shoulder.

O'Hair said a new group of stakeholders that includes Caltrans, Richmond and the refinery is currently working to find a solution.

But Trails for Richmond Action Committee Chairman Bruce Beyaert said the refinery's argument for not allowing the bicycle path is thin.

"A hundred or so bicyclists and pedestrians in an enclosed path each day would not make any difference," Beyaert said. "Chevron doesn't identify with the Bay Trail or providing safe access to Point Molate, and they're searching for reasons to say 'no.'"

GUEST COMMENTARY

GAYLE McLAUGHLIN

 From City Hall

Richmond must insist that Chevron do better

Contra Costa Times

Article Launched: 08/11/2007 03:03:07 AM PDT

RICHMOND IS home to the Chevron oil refinery, the second-largest refinery in California. Our residents have suffered decades of severe consequences from its presence.

The Earth's oil supply is dwindling, and the fossil fuel industry must now refine dirtier crude oil containing heavier amounts of sulfur.

To process this more-toxic oil, Chevron is proposing modifications to its Richmond refinery under the title "Energy and Hydrogen Renewal Project."

Chevron's draft environmental impact report claims that the modifications will have little to no significant impact on the lives of Richmond residents.

Based on what I know at this time, this is untrue.

If implemented as proposed, it appears that the project may add significant levels of pollution to our community, further contaminating our air and water.

It appears that the project will increase Chevron's incidence of "flaring," a practice that burns and releases toxic gases into the air to prevent explosions.

Four other Bay Area refineries have decreased their flaring in the past two years, but Chevron's flaring has risen significantly.

Richmond's elected officials have the duty to seek and distribute the truth of this project and to protect our residents from further harm.

Here is where I stand: While I will await the final environmental report and other evidence before making any decision on Chevron's application, it is critically important that any proposal from Chevron not add more pollution to our community.

Specifically, what can we expect if the Chevron project, as currently outlined, comes to pass?

Based on the information I have seen to date, each year, 100 additional tons of carbon monoxide, 12 more tons of particulate matter and more than 26 more tons of volatile organic compounds (VOC) will pour into our air.

Local physicians are especially alarmed about any increase in VOC emissions: VOCs mix with sunlight to produce ozone, which causes lung injuries, asthma attacks and new cases of asthma and upper respiratory diseases.

Children in Richmond already suffer disproportionately from severe asthma; they are hospitalized for this condition at twice the rate of children throughout Contra Costa County.

Time and again, the Richmond City Council has heard testimony from residents about the impact of refinery emissions on their lives: burning eyes, shortness of breath, foul smells, residues on cars and windows.

One senior citizen from Atchison Village talked about entire days when she is unable to leave her home, even to work in her garden, because of the noxious fumes that permeate the air in her neighborhood.

Chevron could redesign its Richmond refinery so that its operations reduce, not increase, emissions.

The technology exists for Chevron to operate in cleaner and more responsible ways.

As part of public comment, state Attorney General Jerry Brown has submitted a letter stating that the environmental report needs to address a variety of issues, emphasizing the necessity of addressing climate change.

I challenge Chevron's decisionmakers to abandon shortcuts to quick profits.

Chevron has ample resources to invest in equipment and methods that are safer, more efficient and less toxic.

Chevron can do better. The residents of Richmond, and their City Council, should not be afraid to demand it.

McLaughlin is mayor of Richmond.