Settlement Agreement

The City and Sentinel Peak Resources Execute Settlement Agreement Related to Implementation of the Oil Termination Ordinance for the Termination of All Oil Uses in the Culver City Portion of the Inglewood Oil Field

On December 7, 2023, the City of Culver City (“City”) and Sentinel Peak Resources California LLC (“Sentinel”) executed a Settlement Agreement (“Settlement”) to resolve Sentinel’s potential legal claims relating to the City’s Oil Termination Ordinance (“Ordinance”). The Ordinance, which was adopted by the City Council on October 25, 2021: (1) prohibits the drilling of any new wells and the redrilling or deepening of any existing wells; (2) requires the plugging and abandonment of all oil and gas wells by 2026; and (3) requires termination of oil and gas operations, including remediation and restoration of oil use premises, within the City by 2026. The Settlement addresses the Ordinance as applied to Sentinel as the current Operator of the Culver City portion of the Inglewood Oil Field (“City IOF”) and serves as the Termination Program and Schedule for the City IOF.

The executed Settlement includes the following provisions affecting the timing, process and requirements related to the plugging and abandonment of wells and the overall termination and closure of the City IOF:

  • Drilling of new wells and redrilling of existing wells is prohibited, effective from and after the effective date of the Ordinance, November 24, 2021.
  • Sentinel must plug and abandon a minimum of 15 wells by December 31, 2027, at a rate of a minimum of three wells per calendar year over the five-year period between 2023-2027.
  • Sentinel must plug and abandon all remaining wells and complete the overall closure (“Termination”) of the City IOF by December 31, 2029.
  • After December 31, 2027, extension may be conditionally authorized under special circumstances, but not to extend beyond December 31, 2032.
  • Termination will include restoration of the well sites and remediation, restoration and revegetation of the areas of the oil uses’ premises affected by the plugging and removal activities to as near a natural state as practicable and in accordance with, and documented per, the California Geologic Management Division (“CalGEM”) requirements.
  • Until and up to the final Termination date of December 31, 2029, Sentinel may continue with existing oil and gas activities and operations, including routine maintenance that does not involve redrilling or deepening of existing wells.
  • Sentinel must maintain performance bonds through completion of Termination in amounts consistent with the estimated true costs, documented by a Cost Study, for all work required to be performed to complete Termination.
  • Sentinel must maintain insurance coverage, including sufficient coverage for sudden accident and pollution liability, through completion of Termination.
  • Sentinel must indemnify the City against certain third-party claims.
  • Remedies available to the City include performance bonds, specific performance and liquidated damages.
  • Annual Well Renewal, Annual (Fire) Inspection and Well Abandonment fees must be paid in accordance with Chapter 11.12 and the City’s adopted Fee Schedule.

To access a copy of the executed Settlement Agreement, please visit the following link:  Final Settlement Agreement(PDF, 1MB)

Status of implementation and performance required per the Settlement Agreement are indicated below.

If you have any questions or comments, please email City Attorney Heather Baker  or Deputy City Attorney Christina Burrows, or call them at (310) 253-5660. 

Well Closures

Sentinel Peak Resources has closed three wells by December 31, 2023 in accordance with the Settlement Agreement.
City Acknowledgement Letter of 2023 Well Closures(PDF, 131KB)

 

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