RSS Feed
Print Story
E-mail Story
Officials say Big West aids small producers, local economy
| Saturday, Feb 16 2008 9:28 PM
Last Updated: Saturday, Feb 16 2008 9:28 PM
With a $5,000 loan from his mother, Chad Hathaway leased six oil wells from the state in 2001 that were orphaned by small producers bankrupted when oil prices plunged in the mid-1980s.
BAKERSFIELD.COM HOT TOPICS:
Loading Stories
Advertisement
To view video for this story
please update your Flash player
Photos:
Chad Hathaway, owner of a small independent oil company, is among industry insiders saying Big West's expansion would boost the local economy.
Related Stories:
The first year, production averaged about eight barrels a day. As oil prices rose over the next few years, the 31-year-old was able to expand. The company now has more than 40 wells in northern Kern County and pumps 180 barrels a day. Annual revenue for Hathaway LLC is expected to jump from more than $1 million last year to more than $5 million this year.
In addition to climbing prices, Hathaway credits his success to the Big West of California refinery.
“Big West creates a market for our crude oil,” Hathaway said. “There’s very few buyers in Kern County, and having that refinery available to us gives us little guys some options.”
Industry officials say small producers like Hathaway rely on Big West and that the expansion would benefit the local economy and consumers, too.
Almost all the additional 1.2 million gallons of gasoline and diesel produced each day would be sold in the Central Valley, refinery officials said. That’s close to what is delivered to Kern from other parts of the state.
In many ways the increase in local production should stabilize prices at the pump, said Mark Del Papa, an executive for Fleet Card Fuels, a regional fueling company.
Using local gas cuts out the cost of bringing it here. The benefits also come in increased supply. Now, gas produced by California refineries is almost equal to demand for it, Del Papa said. Supply interruptions from a refinery shutdown or fuel distribution problem can spike prices.
Since gas produced in neighboring Nevada, for example, doesn’t meet California’s clean fuel standards, fuel must be imported from places like Finland or the Caribbean — which takes time and comes at a higher cost.
Opponents need to consider that, Del Papa said.
“We live in a world where people like their cars but they don’t like refineries in their backyard,” he said. “You can’t have your cake and eat it, too.”
Expansion would create 100 new jobs at the facility paying an average of $70,000 a year, plus an average of 700 jobs during the two-year construction period, refinery officials said. It would also double the facility’s property tax payouts to $3 million a year, meaning more money for schools and county services, proponents say.