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  Will Richmond Fire Sale Point Molate to Chevron to Balance the Budget?
November 2, 2003

Since accepting transfer of Point Molate from the Navy on September 23, City of Richmond officials have apparently contacted only one suitor – Chevron Texaco.

Anticipating the transfer, the City earlier this year released a Request for Proposals to potential developers. Several responses were received from qualified development teams. None has been contacted about interim use of the facility, nor has any move been made toward selecting a developer.

Instead, City officials have been conducting secret meetings with ChevronTexaco to discuss a rental of the property for a year or so for perhaps millions of dollars. The terms “slippery slope” and “foot in the door” come to mind. Allegedly, Chevron’s motive is concern for its security. This is a pretty transparent pretense coming from a company whose level of concern about its western flank is so high that it allows a construction camp and homeless encampments on its property and fails to deter dumpers (see West County Times October 26, 2003, “Refinery seeks Point Molate Security buffer – ChevronTexaco officials say Richmond site is secure, but they are asking city to halt plans to develop closed fuel depot”).

The City of Richmond is broke to the tune of a $10 million deficit, but Chevron Texaco is flush with money. Just yesterday, the Contra Costa Times noted: “San Ramon oil giant ChevronTexaco Corp., the second-largest U.S. oil producer, reported its biggest profit since the 2001 merger that created the company. Earnings exceeded analyst expectations as prices rose and refining margins widened.”

There are hints that Richmond would be willing to “trade its birthright” (Point Molate) for a few shekels to balance its budget. What would ChevronTexaco do with Point Molate? Until now, the thought was that they would simply close it off to prevent development. Now, a more sinister plot has come to light. On October 30, ChevronTexaco announced plans to construct a $650 million offshore liquefied natural gas (LNG) receiving and regasification terminal, to be located approximately 8 miles off the coast of Baja California, Mexico.  

Where would the LNG exported from Mexico end up? John Gass, President of ChevronTexaco Global Gas, said, "Growing demand for natural gas in North America is widely projected to outstrip current supply capabilities. We believe ChevronTexaco's proposed Baja California offshore LNG project will help fuel the development of a sustainable, future energy plan for Mexico and the United States and play an important part in meeting this demand."

ChevronTexaco went on to say that “additional LNG terminal projects are also under consideration for potential installation in California.” There are indications that Chevron’s ultimate plan for Point Molate is to develop it as a LNG terminal for Mexican gas.

The City of Richmond is paying approximately $20,000 a month for a 24-hour security presence at Point Molate – which is a good thing. If ChevronTexaco is really concerned about security on their western flank, the first thing they would do is step up to the plate and pick up the tab.

The City of Richmond needs to get with the program of contacting potential developers of Point Molate and selecting one. This slow dance with ChevronTexaco appears to be heading nowhere the City of Richmond should be going.