LA Investigates Restricting Oil Drilling

The Los Angeles City council voted on Tuesday to further investigate banning oil production in sensitive areas. The City Attorney’s office has been tapped to provide a summary of the potential legal consequences associated with this ban constituting a “taking” of private property in the form of subsurface oil rights. This fight implicates the regulatory takings doctrine, a Supreme Court doctrine based on the takings clause of the 5th Amendment to the Constitution. The doctrine has been a source of debate amongst legal scholars for quite some time, however, it has not been seriously implicated in a Supreme Court Decision for decades (instead the court has decided these takings cases on other grounds). If a ban moves forward, the biggest questions will be whether seriously limiting the ability to place oil production facilities in residential zones constitutes a “complete taking” denying the property owner of any viable use of the land. On one hand, this move could significantly limit oil exploration in the city limits. On the other hand, other viable uses of the surface land still abound, and access to the subsurface oil may be possible (though more expensive) from alternative sites.

A majority of the oil wells in Los Angeles are located in San Pedro, Mid Wilshire, and Echo Park. Often these oil wells hide in plain site, disguised as run-of-the-mill buildings.