ACQUISITION STRATEGY

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6.1 Surface development rights

Surface development rights for Banning Ranch are owned by NBR LLC. The Conservancy’s first priority is to purchase the surface development rights at fair market value from NBR LLC, thus removing any future threat of development. Any acquisition plan will consider liability issues.

 

6.2 Subsurface mineral rights

Any conservation plan for Banning Ranch will have to resolve issues concerning the future of the oil operation and mineral rights on Banning Ranch. As in the case of the surface development rights, any plan relating to the future of the oil operation and mineral rights will consider liability issues.

 

 

Banning Ranch currently includes an active oil field

 

Three options currently under consideration are:

 

  • Purchasing the mineral rights from Horizontal Development LLC. This would be the most expensive option (Banning Ranch produces an estimated 200 barrels of oil/day), but would guarantee that the oil operation on Banning Ranch would be abandoned in a timely manner. Any plan to purchase the mineral rights on Banning Ranch would involve discussing the cleanup of the property.

 

  • Arranging for consolidation of the oil operation to a smaller platform. This will require arriving at an arrangement with the mineral rights owner and operator of the oil field to abandon operations on most of Banning Ranch and relocate to a smaller platform in the lowlands. Any plan to consolidate the oil operation on Banning Ranch would involve discussion of the cleanup of the property.

 

  • Plan for the continued operation of the oil field while concurrent restoration efforts are in effect on portions of Banning Ranch where there is no active oil operation. Initial public use would be permitted in a controlled manner in order to avoid interference with the oil operation.  As cleanup responsibilities would remain with the mineral rights owner and oil field operation, this option would be the least expensive.  As the remaining oil reserves are depleted, the oil operation would eventually cease.  Abandonment of oil wells and cleanup of operational areas would be the responsibility of the mineral rights owner and the oil field operator.
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