Los Angeles Leading The Charge Against Fracking
BMI View: We believe the main impact of the recently passed Los Angeles fracking moratorium will be to increase pressure on California's governor, Jerry Brown, to pass more stringent state-wide regulations. While we remain sceptical that this will create the desired effect, we note that if successful it would hinder the still nascent development of the potentially promising, but also technically challenging Monterrey shale play.
Los Angeles' City Council has passed a motion which would prohibit fracking and other well-stimulation techniques within the city limits until drillers can prove the safety of such activities to the body's satisfaction. The motion will now move to the city attorney's office to be written as a zoning ordinance, before returning to the council for a final vote. If it receives final approval, this will make Los Angeles the largest city in the US to have banned fracking, and the only oil-producing city in California to have done so. As it is uncertain how many wells are being fracked in the area at this time, there is little way to determine the immediate implication of this ban, though the ramifications on state-level politics are perhaps even more important.
Direct Impact Uncertain…
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