Cat Canyon Resources LLC, formerly ERG Operating Co. and then Terracore, has withdrawn its application to drill 233 new steam-injection oil production wells on its West Cat Canyon lease.
The withdrawal Monday marks the last of three oil and gas production projects proposed for the East and West Cat Canyon areas that all were pulled from the Santa Barbara County permit process this year.
“The applicant made this decision to focus on their existing operations and regulatory entitlements within the State Designated Cat Canyon Oil and Gas Field, and plans for future similar projects within their West Cat Canyon areas of operations,” the county Planning and Development Department’s website states.
Errin Briggs, supervisor for the department’s Energy, Minerals and Compliance Division, however, said he had not heard anything from Cat Canyon Resources or any other oil company about potential expansion or new development in the Cat Canyon Oil Field.
“Generally speaking, everything’s headed in the contraction direction, not expansion,” Briggs said.
No one from Cat Canyon Resources returned a call for comment by press time Thursday. But Briggs speculated the company pulled the application due to simple economics — the cost of the project versus the benefit it would generate.
“I know for sure the economics are tough,” he said. “At 40 bucks a barrel, it’s hard to make any money.”
Crude oil prices plunged earlier this year as the result of a price war between Saudi Arabia and Russia, when the Saudis increased production to flood the market.