The Trump administration is considering creating a petroleum reserve in California after a proposal from Sable Offshore Corp. The company proposed a West Coast Strategic Petroleum Reserve, and U.S. Energy Secretary Chris Wright confirmed that there is “active dialogue” on the issue, according to E&E News. The administration cited the state’s strategic military importance, geographic isolation from major domestic energy networks, and increasing dependence on imported crude oil. A reserve would require a major expansion of oil infrastructure in California.
Sable proposed the reserve following inquiries from the Trump administration and as part of discussions regarding oil and gas supplies for California, Politico reported. Sable made the proposal during a visit by Wright and Interior Secretary Doug Burgum to Sable Offshore Corp.’s facilities, according to Politico.
The reserve would have an initial storage facility with a capacity of approximately 370,000 barrels and expand to a reserve that could store up to 30 million barrels of crude oil. The facility would be intended to support military installations in California and supply oil refineries in the state.
The Trump administration has raised concerns that refinery closures, declining in-state oil production, and growing reliance on imported crude have increased California’s exposure to fuel supply disruptions and price volatility. Energy Secretary Chris Wright and Interior Secretary Doug Burgum have argued that the state’s geographic separation from major U.S. refining centers, combined with its concentration of military facilities, creates broader energy security concerns. Administration officials contend that California’s energy policies have contributed to increasing dependence on foreign crude supplies.
State officials and market analysts have increasingly focused on declining refining capacity, rather than the availability of crude oil, as the more significant long-term fuel supply challenge. Planned refinery closures and renewable fuel conversions are reducing the state’s ability to refine crude oil into transportation fuels. (see California Faces Growing Fuel Supply Crisis, New Report Warns; see also California Oil Refineries).
The proposal would mark a significant expansion of federal involvement in the state’s energy infrastructure and could become a focal point in ongoing disputes over California’s planned transition away from fossil fuels.