CIPA Bonding Fix Clears Senate Natural Resources on Bipartisan Vote

CIPA-sponsored AB 2716, authored by Assemblymember Anamarie Ávila Farías, cleared another major hurdle last week when it passed out of the Senate Natural Resources and Water Committee on a unanimous bipartisan vote of members voting.

The bill passed 6-0-1, with support from Chair Josh Becker, Senators Christopher Cabaldon, John Laird, Henry Stern, Vice Chair Kelly Seyarto, and Senator Shannon Grove. Senator Ben Allen abstained.

AB 2716 is CIPA’s sponsored legislation to repair the consequences of AB 1167, which has frozen responsible transactions, impaired operator valuations, and made it harder for capable operators to acquire assets, invest in compliance, and keep California production in the hands of regulated, accountable companies.

The bill does not weaken financial assurance. It modernizes it.

AB 2716 maintains CalGEM oversight, preserves operator responsibility, and allows workable financial assurance tools such as self-insurance, corporate guarantees, and other equally effective mechanisms where appropriate. It also creates a practical pathway for responsible decommissioning-only transfers, allowing wells and facilities to move toward plugging, abandonment, and cleanup without being trapped by an unworkable transaction structure.

That is the whole point. California should not punish responsible operators for trying to do the right thing.

The bipartisan support in Senate Natural Resources and Water confirms what CIPA has argued from the beginning: this is not a partisan issue. It is a practical fix. AB 2716 protects workers, local governments, responsible operators, and the state’s long-term energy reliability.

It also protects California from the very outcome current law risks accelerating: fewer in-state producers, fewer wells in active stewardship, less local production, more idle assets, and greater dependence on foreign oil.

California still uses oil every day. The question is whether that oil is produced here, under California’s labor, safety, and environmental standards, or imported from countries that do not meet those same standards. AB 2716 helps keep production, jobs, tax base, and accountability here at home.

The bill now moves to the Senate Appropriations Committee, where it is expected to be heard after the Legislature returns from summer recess, likely in August. The Senate Natural Resources and Water Committee amended the bill, and those amendments will be reflected before the Appropriations hearing.

CIPA thanks Assemblymember Ávila Farías for her leadership, the committee members who supported the bill, and the coalition of producers, local government voices, and industry partners who continue to make the case for responsible California energy production.

AB 2716 is moving forward because the facts are on our side. California needs a system that prevents orphan wells, protects taxpayers, keeps responsible operators in business, and allows the state’s own energy resources to be produced safely and lawfully.