Rincon Island LP, an oil and gas production company, has filed for bankruptcy protection to block the state of California from forcing the company to perform extensive remediation on its wells amid environmental concerns, the Wall Street Journal reported today. The company filed for chapter 11 protection on Monday with the U.S. Bankruptcy Court in Dallas as California’s Natural Resources Agency issued an emergency order mandating the environmental safety work on Rincon Island’s idle properties, including installing plugs and shut-off valves on certain wells. The order requires Rincon to pay for the extensive remediation. The report prompted a call from state Sen. Hannah-Beth Jackson urging California to close the facility completely. She cited the lack of progress Rincon Island has made to address safety troubles. “Despite being warned of this and other issues on Rincon Island on numerous occasions — including deteriorated wellheads and a lack of regular maintenance — RILP has consistently failed to meet milestones,” Sen. Jackson said in her letter. Rincon Island said in a statement that it filed for bankruptcy “in order to protect its key oil and gas leases from a wrongful attempted termination by the state of California. The partnership will be reorganized in order to ensure its long-term financial success.” Read more. (Subscription required.)
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