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Central Coast Battle Shaping Up Over Potential For Huge Oil Fracking Operation

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US-Energy-Gas-Environment A Consol Energy Horizontal Gas Drilling Rig explores the Marcellus Shale outside the town of Waynesburg, PA on April 13, 2012. It is estimated that more than 500 trillion cubic feet of shale gas is contained in this stretch of rock that runs through parts of Pennsylvania, New York, Ohio and West Virginia. Shale gas is natural gas stored deep underground in fine-grained sedimentary rocks.  (Mladen Antonov/AFP/Getty Images)

US-Energy-Gas-Environment A Consol Energy Horizontal Gas Drilling Rig explores the Marcellus Shale outside the town of Waynesburg, PA on April 13, 2012. It is estimated that more than 500 trillion cubic feet of shale gas is contained in this stretch of rock that runs through parts of Pennsylvania, New York, Ohio and West Virginia. Shale gas is natural gas stored deep underground in fine-grained sedimentary rocks. (Mladen Antonov/AFP/Getty Images)

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AROMAS (CBS 5) – A new gold rush is on in California, but this time it’s liquid gold. Instead of strawberries and artichokes, the Central Coast is getting a growing reputation for being the next motherlode for oil.

That news is causing fears that a controversial extraction method called hydraulic fracturing – or fracking- is coming to town.

When the big trucks rolled up to Jim Leap’s ranch near Aromas in Monterey County last month he was told it was for seismic testing.

“Naïve me I think, ‘wow this is really exciting,’” recalled Leap.

He didn’t think much of it initially because his ranch sits right on the San Andreas fault. But it didn’t take long for Leap and Polly Goldman to get suspicious.

“As soon as I saw how many people were involved I just felt like ‘I don’t see how this could be about earthquakes. Because who has that amount of money?’” Goldman said.

As it turns out, they were right to have doubts. Much to their surprise, the couple discovered their land, and their town of Aromas on the Central Coast, is sitting on one of the richest deposits of oil in the United States, called the Monterey Shale.

Starting just south of the Bay Area, it runs through the middle of the state – covering 8 counties. Underneath, according to a recent federal report, 15.5 billion barrels of oil, nearly two thirds of the nation’s oil reserves.

“I was like ‘wow! I had no idea,’” said Goldman when she heard the news.

Oil deposits are so hard to get to here that drilling would have been economically unfeasible just a few years ago. But now it’s possible, thanks to advances in hydraulic fracturing, better known as fracking.

The technique creates fractures in rocks thousands of feet below the surface by injecting them with water laced with chemicals and sand, allowing oil or gas to flow out.

Environmentalists are sounding the alarm because in other states fracking and disposal of fracking waste has been linked to cases of groundwater pollution, drinking water contamination and even earthquakes.

Could fracking be coming to Aromas? The news spread fast.

Pat Lerman is now the spokesperson for a new community group calle “Aromas Cares for Our Environment.” www.aromascares.org.

“Within a week we had gone from 5 to 50 people,” said of the group. She soon found out that California is one of the states with the least oversight on fracking. “California has no regulations, none, on fracking,” she said.

Industry spokesperson Tupper Hull said people are over-reacting, and in California so far fracking has been perfectly safe.

“There has never been a suggestion that hydraulic fracturing here has resulted in seismic activity of any kind,” said Hull.

So who’s behind the prospecting in Aromas? As it turns out, Freedom Resources, the company that paid for the seismic testing, keeps a low profile. It’s registered out of Los Angeles to Clint Chung, no phone number or website was available.

A P.O. Box in Watsonville led us to Kevin Jeffrey, who told us he was an operating manager with Freedom Resources.

Jeffrey also happens to be the chief legal counsel for Graniterock, a local quarry and the biggest landowner in the area.

“The goal for Graniterock is to thoroughly understand our granite deposit, how deep it is, how wide it is,” he said. “Graniterock is not in the oil business.”.

But what about his company Freedom Resources?

“Freedom Resources is an oil and gas exploration company,” said Jeffrey.

So is Graniterock trying to get into the oil business?

“If the seismic survey does show some possibility of oil, then we will work through the permitting process,” said Jeffrey.

He promises there will be no fracking. But he wouldn’t say how oil would be extracted if found, leaving the people of Aromas unconvinced.

“If this is the gold rush, and it is, we need to get ahead of this and we obviously need to get ahead of it very fast,” said Lerman.

“I don’t want to rely on someone’s word. I want there to be regulations in place that protect us all,” said Polly Goldman.

(Copyright 2012 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

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