Ritzy Beverly Hills's famous oil well, which sits on the grounds of their high school and is bedecked in flowery art, has long been scheduled to stop extracting oil at the end of this year, with cleanup of the site supposed to begin as soon as possible, lasting about three months. But, says the Beverly Hills Courier, there are a couple kinks in the plan: One, remediation's going to take years, not months, according to the company that operates the rig, and two, the company might not be in business long enough to foot the bill for the process.
Venoco, the company that was leasing the oil well site on Beverly Hills High School property from the BH school district, has as a condition in their lease that the site has to be cleaned by March 2017. Their lease expires on December 31, 2016, so that's about three months to get the job done. But Venoco says the task will be "expensive and complicated"—so complicated that it could take "several years" and cost between $10 and $15 million.
However, Venoco also might be bankrupt by then; they've been struggling financially "in the wake of falling oil prices and the ongoing closure of Plains All-American pipeline," and failed to make an interest payment last week. If the company files for bankruptcy, it's likely that the Bev Hills School District will be left with the financial responsibility for cleaning up the property.
The end of 2016 is a deadline for all oil extraction in Beverly Hills city limits; that's a big reason why the lucrative contract with Venoco wasn't renewed, despite the company's hopes to the contrary. Maybe they thought they'd have a chance to extend their lease because the derrick was such a payday for BH—Venoco pays Beverly Hills about $500,000 and the school district about $600,000 a year for the lease. Meanwhile, getting rid of it could potentially cost them millions, if Venoco doesn't step up.
In the meantime, it's basically a waiting game. "The school district is carefully weighing its options and is currently working with the City to ensure that Venoco will meet its obligations to abandon the site in a timely fashion," the school board president tells the BHC.
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