Court Victory Keeps SB 1137 Moving Forward

California’s independent oil producers secured a pivotal win last week in their ongoing battle against Senate Bill 1137, the 2022 law that imposed sweeping restrictions on oil and gas operations. In a ruling with far-reaching implications, the Los Angeles Superior Court rejected the State’s attempt to dismiss the lawsuit brought by the Native Oil Producers and Employees of California (NOPEC).

The court’s decision keeps the case alive, ensuring that the law’s controversial underpinnings will be tested in court rather than buried in procedural maneuvers.

A Flawed Law Passed in Haste

SB 1137 was rushed through the California Legislature in the final days of the 2022 session. With little more than five days of review before passage, the bill imposed a 3,200-foot setback on new oil wells and effectively banned routine maintenance of existing facilities near homes and businesses. No hearings were held, no experts were called to testify, and no real scientific review was allowed.

Instead, the State leaned on a discredited Scientific Advisory Panel report – a compilation of disparate studies that failed to establish any causal link between California’s oil operations and alleged health harms. In short, the law was political theater masquerading as public health protection.

For producers, the stakes were existential. Without the ability to drill new wells or maintain current ones, much of California’s oil production would wither. Thousands of jobs would be threatened, billions in tax revenue lost, and refiners forced to rely even more on foreign imports.

The Court’s Findings

The court’s ruling last week cut to the heart of the producers’ challenge. Among the key points:

• Arbitrary Legislative Findings: The plaintiffs presented sufficient evidence to argue that SB 1137’s findings lack scientific merit.

• Vagueness and Overreach: The court agreed the law’s definitions may be unconstitutionally vague.

• Takings Clause: The ruling recognized that by cutting off mineral owners’ access to their property, SB 1137 could constitute an illegal taking.

• Ripeness: The State’s argument that the case was “premature” was dismissed—the impacts of the law are already real and immediate.

“This ruling affirms what we have said from the beginning: SB 1137 is a deeply flawed law that punishes working families, increases foreign imports, raises gas prices, and ignores science,” said Rock Zierman, President of NOPEC.

The case now proceeds toward trial, with a status conference scheduled for September 22, 2025.

Why It Matters Now

California’s refineries are already warning about instability in the fuel supply chain. Several facilities have closed or converted to renewable operations in recent years. Others are running at reduced capacity due to a lack of in-state crude supply. Without meaningful production from California operators, refiners are increasingly reliant on foreign oil – much of it from nations with environmental and labor practices far below California’s standards.

At the same time, working families continue to struggle under some of the highest gasoline prices in the nation. Every barrel of California crude replaced by foreign imports raises costs, weakens U.S. energy security, and exports jobs overseas.

The court’s ruling ensures that the central questions – about the constitutionality, science, and purpose of SB 1137 – will be decided based on facts and evidence rather than politics.

CIPA’s Role and the Road Ahead

For CIPA members, this ruling validates years of advocacy. From the rushed passage of SB 1137 to the successful referendum that temporarily delayed its implementation, and now to the courtroom, independent producers have carried the fight to ensure California energy policy remains grounded in reality.

The challenge to SB 1137 is more than a legal dispute; it is about whether California will continue to produce its own climate-compliant crude oil under the strictest standards in the world, or whether it will deliberately outsource production to foreign regimes exempt from California’s rules.

CIPA will continue to track the litigation closely and ensure that members are equipped with the facts, the context, and the strategy to defend in-state production.

The September 22 court conference will be a critical next step. Between now and then, operators must remain engaged, vocal, and united. The fight is far from over, but last week’s ruling was a powerful reminder that facts and persistence still matter.

SB 1137 Timeline at a Glance

• September 2022 – Legislature passes SB 1137 in the final five days of session by a bare majority, with only one policy hearing in the State Assembly and without expert testimony.

• December 2022 – Industry-led referendum campaign qualifies for the ballot, delaying implementation of the law.

• Spring 2024 – Referendum pulled by CIPA in favor of this legal strategy which has more staying power.

• August 2025 – Los Angeles Superior Court rejects the State’s attempt to dismiss the lawsuit, allowing the case to proceed.

• September 22, 2025 – Status conference scheduled to determine next steps toward trial.
  

CIPA will continue to battle against SB 1137 and its arbitrary and capricious ruination of California’s independent oil and gas producers.