California Oil Education Series: My Perspective | Seal Beach – Part 1

Seal Beach Oil Field Well: A demonstration of how the oil and gas industry is co-existing with an urban environment. Here a workover rig is performing well maintenance adjacent to a community with homes worth $1.1 million - $2.5 million.
Seal Beach Oil Field Well: A demonstration of how the oil and gas industry is co-existing within an urban environment. Here a workover rig is performing well maintenance adjacent to a community with homes worth $1.1 million – $2.5 million.

Alternate view: Seal Beach Oil Field Wells: Here is a workover rig performing well maintenance next to other wells and pump jack units.
Alternate view: Seal Beach Oil Field Wells: Here is a workover rig performing well maintenance next to other wells and pump jack units.

I like these photos that I took yesterday in my local community of Seal Beach, CA where I am setting up my business. It motivated me to share it with everyone as it’s a demonstration of the symbiotic relationship that the oil and gas industry in California has with the community, the environment, the city and the federal government.

You see what the industry calls a “workover rig” or “completion rig” which is behind a walled/fenced in group of oil wells and pump jack units (aka “nodding donkeys” or “exercising kangaroos”). These types of rigs are an enhanced truck that’s modified with a mast and cable system capable of pulling the steel casing (mainly a steel straw) out of the wellbore to fix or improve the hydrocarbon production coming from the well. The rig and crew of two are working on an oil well that is part of the Seal Beach oil field. I won’t share the operator, the well’s name or how much oil it produces as that’s not relevant to why I am writing this article. What’s unique is that its location is at the entrance to the Heron Point Community neighborhood where the houses range from about $1.1 million – $2.5 million. Oil wells are common throughout California communities of various social-economic ranks. The famous upper-class neighborhood is probably Beverly Hills in Los Angeles.

Beverly Hills Oil Field - Tower of Hope - Courtesy of Venoco Inc. http://www.venocobeverlyhills.com/tower-of-hope/
Beverly Hills Oil Field – Tower of Hope – Courtesy of Venoco Inc. http://www.venocobeverlyhills.com/tower-of-hope/

Many folks in California don’t like the wells being in their community which has led to many of the environmental groups taking action against the oil companies often using misguided information to make false claims. Santa Barbara County has taken regulating the oil industry to an entirely new level. However, I’ll save that topic for another time. Regardless, actions from environmentally strengthened groups have led to the strictest oil and gas regulatory environment in the US making it a higher challenge for local oil and gas operators to do business of providing energy for California.

Seal Beach Oil Field Well: A demonstration of how the oil and gas industry is co-existing with an urban environment. Here a workover rig is performing well maintenance adjacent to a community with homes worth $1.1 million - $2.5 million.
Seal Beach Oil Field Well: A demonstration of how the oil and gas industry is co-existing with an urban environment. Here a workover rig is performing well maintenance adjacent to a community with homes worth $1.1 million – $2.5 million.

In any event, back to the photo. You see iron silhouettes of herons that decorate the front entrance gates. Herons are part of the community as the City of Seal Beach is in Orange County and surrounded by wetlands, bays, harbors and a former NASA rocket testing center. Some of the country’s largest oil fields exist beneath the Southern California coastal environment like this one. The counties of Santa Barbara, Ventura, Los Angeles and Orange all contain oil fields along the coast as well as multiple oil platforms exist offshore California.

The Seal Beach oil well being worked on is about one mile from the beach and ~200’ to the nearest house. What you don’t know (and will hopefully see in the link below from the Center for Land Use Interpretation) is that across the street from this community is the Seal Beach Naval Weapons Station AND the Seal Beach National Wildlife Refuge (part of the U.S. Fish and Wildlife Service). I think that’s awesome. Some will agree with me and some won’t. Perhaps you don’t care. I think one thing that is certain is that the relationship between all these entities needs to continue in a manner where all parties benefit mutually. The oil and gas industry in California is not going away. The fact that the operator of this well is spending the money to perform work on it demonstrates a balanced relationship, and that continued investment in the oil industry is happening now. It’s an excellent time to invest in oil projects like I am doing in the US. The time is NOW.

Greater Seal Beach Oil Field Area
Greater Seal Beach Oil Field Area

The Center for Land Use Interpretation put together an online slideshow which provides more photographs that provide a larger perspective about the local area. Many thanks go to them for sharing it. See links below to the slide show and also to the organization.
http://clui.org/ondisplay/urbancrude/online/slideshows/south_coast.swf

Center for Land Use Interpretation: http://clui.org/

Seal Beach National Wildlife Refuge: https://www.fws.gov/refuge/seal_beach/

Please feel free to contact me at the email address below.

Tim Rathmann
Founder,Entrepreneur & Petroleum Geologist
tim@rivunc.com
www.rivieraunconventionals.com

It’s Go Time – Time To Invest In Oil

Seal Beach Pier on May 5th, 2016 with representation of the oil and shipping industries in the background. Picture courtesy of Tim Rathmann
Seal Beach Pier on May 5th, 2016 with representations of the oil and shipping industries in the background.

I took this photo from the Seal Beach pier in Southern California this morning. It’s cloudier than usual, however, what you can see is an oil field worker heading out to the crew boat to start his shift on one of the many platforms offshore California. What you don’t know is that there were usually three or four crew vessels and about 50-60 workers on this pier at this time over a year ago catering to the different platforms. It is a reminder of the effect the low commodity price has had on the industry and, sadly, it is no different in California.

The problem is that many don’t see this time in the industry as an opportunity to invest in oil. You’ll see me repeat this statement over and over again “The time to invest in oil is now!” It’s not just me stating that, this message is all across the industry by smaller operators in places like Texas, Oklahoma, Kentucky,Kansas, Tennessee and Pennsylvania. It may appear to be hidden by news of layoffs and bankruptcies for many. However, there are tons of opportunities out there to invest.

I’m not talking about buying stock in oil field related companies or maximizing your employee stock share program. That could be beneficial for the conservative folks or complacent types. It’s not where higher risk / higher reward is, though. I’m talking about purchasing oil wells, buying leases, participating in turnkey drilling and production projects, buying overriding royalty interests and partnering in equity projects. These are only some of the examples.
Perhaps it’s due to statements like this:

OIL AND GAS EXPLORATION IS CONSIDERED HIGH RISK AND CAN RESULT IN 100% LOSS OF CAPITAL.
INVESTING IN THIS SPACE IS FOR OIL AND GAS OPERATORS AND INDUSTRY PLAYERS THAT UNDERSTAND THE INHERENT RISKS AND REWARDS OF OIL AND GAS EXPLORATION.

Well, that doesn’t read very attractively for those that don’t understand the risk vs. reward models in this industry. However, there are tax advantages and potentially high rewards which make oil and gas investment attractive. You just have to know how to mitigate your risk through proper geological evaluations and economic analysis. These opportunities are mainly economic in the onshore US so keep that in mind. I’m not advocating for any offshore or international opportunities at this time. Please don’t let the photo above misguide you.

I recently read an article that was written earlier this year by John F. Templin II, Ph.D. and couldn’t agree more. Thank you, John, for writing it. See link below.
https://www.linkedin.com/pulse/venture-capitalist-dream-time-now-john-f-templin-ii-ph-d-?trk=v-feed

Tim Rathmann
Founder,Entrepreneur & Petroleum Geologist
tim@rivunc.com
www.rivieraunconventionals.com