Hermosa Beach Settles With E&B for $1.5 Million

HERMOSA BEACH, CA -- Decades of disagreement over oiling drilling rights in Hermosa Beach came to an end after the city agreed to a $1.5 million settlement with E&B Natural Resources.

Under the terms of the settlement, the energy company agreed to terminate all claims against the city, including the 1992 lease on the City Yard, the 2012 contract with the city and all rights to mineral resources within the city's limits. The settlement will come out of the city's general fund.

“This settlement, achieved through compromise over conflict, reflects the hard work and goodwill of everyone involved,” E&B President Steve Layton said in a statement. “As a resident of the community, I am happy that the city and E&B were able to resolve our remaining differences, allowing each side to accomplish their basic objectives.”

Hermosa Beach residents rejected Measure O, which would end the city's ban on oil drilling, in March 2015 by a wide margin, effectively ending any oil drillings in the city.

“With this settlement, Hermosa Beach has conclusively eliminated E&B’s potential for oil drilling in the City of Hermosa Beach, achieving what the community expected when it voted against Measure O,” Mayor Hany Fangary said in a statement.

After Measure O's defeat, E&B planned to sue the city for the interests owed on payments to the company. The accrued interest came to an excess of more than $3.5 million, according to E&B.

The settlement agreement was approved unanimously by the City Council in closed sessions Feb. 28.

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