President Donald J. Trump has the authority to restart an oil pipeline project off the Santa Barbara coast by invoking the Defense Production Act, the Department of Justice said last week in a legal opinion, to override California laws blocking the restart of offshore oil production and the Santa Ynez Pipeline System.
Trump’s action will have a positive effect on gas prices in the State of Nevada, which relies heavily on fuel production and transportation from California.
The opinion explains that presidential directives issued under congressional authority carry the force of federal law and may override conflicting state regulations, the Pipeline & Gas Journal explains. “An order issued as an exercise of congressionally delegated authority or the President’s constitutional powers has the force of federal law under the Supremacy Clause and may preempt contrary state law,” the memo says.
In response to President Trump’s invoking the defense production action, U.S. Secretary of Energy Chris Wright directed Sable Offshore Corp. on Friday to restore operations of the Santa Ynez Unit and Santa Ynez Pipeline System to address supply disruption risks caused by California policies that have left the region and U.S. military forces dependent on foreign oil.
The Executive Order, Adjusting Certain Delegations Under the Defense Production Act,” specifies the “National Defense Resources Preparedness.”
California Governor Gavin Newsom is destroying the state’s oil and gas industry, and it appears to be deliberate. Newsom is presiding over perhaps the largest collapse of the oil industry, refinery operations and gasoline production in U.S. history.
Just this month, Marathon Petroleum, Chevron, and PBF Energy sent a blistering warning to Governor Newsom and top state officials in a letter declaring that proposed amendments to the California Air Resources Board’s (CARB) Cap-and-Invest program would destroy what is left of California oil refineries.
Most California residents know that California’s self-inflicted gasoline crisis is not only increasing prices at the pump, but also increasing dependency on foreign oil suppliers and shippers to supply fuels to the Golden State. California’s self-inflicted gas crisis is also a direct threat to U.S. military force readiness on the West Coast, the Globe reported in October.
California imports over 70% of its crude oil from foreign sources because it produces less than 23% of its own in-state petroleum needs, and that’s before the refinery closures. The oil and gas industry in California accounts for nearly 8% of the state’s GDP. Without oil and gas, the other 92% of the state’s GDP would be impossible to attain, according to petroleum expert Mike Ariza, USC Professor Michael Mische, and Assemblyman Stan Ellis have been warning.
Arizona gets nearly half of its gas from California. The vast majority of Nevada’s gas, 88%, comes from California.
California, Nevada, and Arizona have 40 military bases and installations.
Secretary Wright said Sable’s facility can produce approximately 50,000 barrels of oil per day, a 15 percent increase in California’s in-state oil production, which can replace nearly 1.5 million barrels of foreign crude each month.
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