The owner of the Inglewood Oil Field filed suit against California over recent legislation to shut down the more than 800 wells in the oil field by 2030. Sentinel Peak Resources alleges that the legislation unfairly targets a single business and imposes “disproportional” penalties.
AB 2716 requires low-production wells in the oil field to be plugged and abandoned within 12 months of supervisor notification and all other wells in the field to be plugged and abandoned by December 31, 2030. Beginning March 1, 2026, the bill prohibits the owners of low-production wells from allowing those wells to operate for more than 12 months and imposes a $10,000-per-month penalty for violating this provision. (see Newsom Signs Bill to Shut Down Inglewood Oil Field by 2030.)
Sentinel Peak argued that the law “represents an illegal attempt to coerce an individual company to stop operation of its legal business,” the Los Angeles Times reported. “The monetary penalties imposed by AB 2716 are grossly disproportional to the gravity of the offense that it is designed to punish,” the complaint states. “The imposed penalties are fixed and mandatory with no apparent upper limit. They have no relationship to any actual harm incurred by neighboring uses.”
“AB 2716 was adopted this year to penalize a lawful business that operates under the most stringent regulations in the world,” a Sentinel attorney stated. “Sentinel Peak is responsibly operating the Inglewood Oil Field and providing valuable energy resiliency to the Southern California market.”
The 1,000-acre Inglewood Oil Field has approximately 835 unplugged wells, according to the Assembly floor analysis of AB 2716. According to 2022 data, 655 of those wells are active, 180 are idle, and 441 are low-production wells, meaning that they produce less than 15 barrels a day.
In 2023, Sentinel Peak Resources and Culver City negotiated an agreement to ban oil drilling in the city’s portion of the Inglewood Oil Field by 2026 as part of the city’s effort to ban oil drilling and phase out oil production. (see Newsom Signs Bill Giving Localities Right to Regulate Oil Operations.)