Bob sent me a few questions concerning an article I had written on increased oil production activity in Ventura County. If you missed it, here's the story:

http://www.venturacountystar.com/ news/2008/aug/13/ oil-drilling-on-rise-in-county-jobs-added/

Here's what Bob wrote:

I just read with much interest the newspaper article (Ventura Star, 8-13-08) on renewed oil drilling in Ventura County.

I am all for it, but I think you left out 3 very important areas that should be/can be mentioned. At least I would like to know the answers to these! If you please:

1) I thought — all — drilling in California was under a/some government mandate: "No drilling for oil in California!" I must be mistaken!?

2) Where does this oil GO for to be refined? Are there "local" refineries, etc.?

3) Who is the "customer/end user," i.e., who uses the product(s) derived from this drilled oil!? Does/will any of the numerous gasoline stations in Ventura County be selling this to "the public"? Or, is it consumed only by some "private sector," etc.??

I think the first question relates to the current debate over offshore drilling. There has been a pretty adamant outcry against offshore drilling along California's coast — the governor and others have made it clear they don't support additional offshore drilling, while others have called for more drilling.

Offshore drilling has been banned for a good chunk of time in a portion of the Outer Continental Shelf. This is what has been hotly debated.

Here are some recent stories on the topic:

http://www.venturacountystar.com/news/2008/jul/31/bush-ramps-up-drilling-efforts/

http://www.venturacountystar.com/news/2008/jul/31/poll-finds-support-for-drilling/

http://www.venturacountystar.com/news/2008/aug/13/new-drilling-must-be-a-part-of-any-energy-plan/

Though this is now under debate, California has a long oil history in locations on land and at offshore sites, including some along Ventura County's coast. According to state Division of Oil, Gas and Geothermal Resources, Ventura County had 17 producing offshore oil wells in 2006 and 1,692 producing onshore oil wells.

Now to what happens to that oil.

California has 21 refineries.

This link will take you to a map showing where those refineries are located:

http://www.energy.ca.gov/maps/refinery_locations.html

You'll see some are pretty close to home here in Southern California.

This link from the state Energy Commission provides a pretty neat resource showing how oil in the state ends up in your car:

www.energy.ca.gov/2008publications/CEC-180-2008-008/CEC-180-2008-008.PDF

It does a good job showing how the refinery process works and what products come out of that process.

It also talks about distribution, including a graphic that shows how that works. Here's the text about distribution:

"Once oil has been processed into gasoline or diesel, the fuel is shipped from the refinery, usually through a pipeline, to a refiner's terminal or to a wholesaler. As the chart shows, from here it is sold, either directly or indirectly.

Additional blending can also take place at this point in the process. At distribution terminals around the state, additives and ethanol are mixed into the fuel as it is loaded into tanker trucks for delivery to retail stations. After a final test to ensure the fuel meets stringent California standards, it is ready for sale to consumers.

These truckloads of fuel can be sold directly to what are called "branded" stations. These sell a specific company's brand of fuel — like Chevron, Shell, Arco and others. Branded stations can be owned by the refiner and operated by their own employees, owned by the refiner but leased to an individual to run, or owned and operated by a retailer who agrees to carry that company's products exclusively.

If the fuel is sold indirectly, it goes to a distributor, or "jobber." This middleman can deliver fuel from a variety of sources to independent stations — stations not affiliated with a well-known brand name. Even though this fuel may not have a national brand attached to it, it comes from the same refineries and meets the same stringent standards set by the California Air Resources Board for all fuels sold in the state."

The same report notes gasoline and diesel are available at about 10,200 outlets around the state, which include retail gas stations, marinas, truckstops and fleet fueling stations.

According to the U.S. Energy Information Administration, California ranks third in the nation in refining capacity and "its refineries are among the most sophisticated in the world."

It also notes that the state's per capita energy consumption is low, but it is the most populous state in the U.S., so its total energy demand ranks second behind Texas.

It also states: "Due to the relative isolation and specific requirements of the California fuel market, California motorists are particularly vulnerable to short-term spikes in the price of motor gasoline. No pipelines connect California to other major U.S. refining centers, and California refineries often operate at near maximum capacity due to high demand for petroleum products. When an unplanned refinery outage occurs, replacement supplies must be brought in via marine tanker."

In 2006, California consumed 713.7 million barrels of petroleum, according to the EIA. That same year, the state produced 249.3 million barrels, according to the state's Division of Oil, Gas and Geothermal Resources.

The Energy Information Administration site also has a map, which shows the state's various power plants, mines, refineries and renewable energy potential. You can find it all here:

http://tonto.eia.doe.gov/state/state_energy_profiles.cfm?sid=CA

I hope that's helpful. As always, please add your comments below if you have more information and insight.

And, if you have business questions that need answering, please send them my way at abruce@VenturaCountyStar.com. Write "Ask Allison" in the subject line so I'll know you're sending in a question.

Note to readers: Questions may be lightly edited for length and clarity.