Peanuts Under the Patio

Oil fever had Los Angeles in a sweat. To the joy of some and the rage of many, the city council last week voted to allow drilling in some residential areas. With Mayor Norris Poulson's approval yet to come, the council backed dezoning of the city-owned Rancho golf course and the private Hillcrest Country Club near Beverly Hills. Thundered the Los Angeles Examiner, decrying the eagerness of adjacent citizens to lease their lawns and barbecue pits: "Is spoliation of these homes to be forced upon the owners for peanuts per lot in return?"

What sparked it all was a growing oilfield (3,000 bbl. a day from twelve wells) on the 20th Century-Fox movie lot adjoining Beverly Hills. Trying to recoup from TV competition, the moviemen leased to oilmen who got permission to drill in 1953. Fox argued that the 280-acre lot was already zoned for manufacturing, and what was the difference between an oil derrick erected for a movie or one to drill? Furthermore, modern drilling avoids the noise and mess that blighted oil-happy Los Angeles in the '20s and brought a ban on drilling.

Golfers & Speculators. On the green acres of four nearby courses, golfers yearned to mix business with pleasure. In no time, the price of memberships shot up so high that some are now more expensive than seats on the Pacific Coast Stock Exchange. The price at the Los Angeles Country Club rose from $3,000 (in 1953) to $10,000, and members who paid a cut-rate $150 in mid-Depression were happy over the best investment they ever made.

To separate golfers from speculators, the club finally spun off a subsidiary oil company called Westla, gave one share of stock each (estimated value: $2,000) to 802 regular members, thus detached the mineral rights from club membership. The Westla spin-off is expected to drop non-oil club memberships to $6,000. Westla will open drilling bids next month from oil companies, who will ask city permission for 30 wells on the 311-acre club. If the city approves, Westla will collect at least 32% royalties; the club will get $50,000 annually for ten years. For those golfers to whom even oil is less important than the ancient game, the club promises that drilling will be done off the fairways by soundproofed derricks, and that hidden pipelines will pump off the oil.

Fuss v. Muss. The Hillcrest Country Club accepts new members only from applicants who filed before Jan. 1, 1952. When the Hillcrest case came before the city council, it met dezoning requirements by having a reported 95% of surrounding homeowners signed up with drillers who would slant-drill from the club's 145-acre golf course. At the same time the councilmen were impressed by the possibility that the city-owned Rancho golf course might be drained of oil by the adjacent movie-lot wells, thus losing potential revenue that could lighten taxes.

As the controversy raged on, oilmen rushed around soothing fears of drilling fuss and muss, tried to round up more homeowners' leases to meet the 51% required for dezoning. They made small progress in Beverly Hills, which refuses to allow the specter of industry in its well-manicured oasis of luxury and wealth. There oilmen found only 220 citizens willing to lease. The remaining 31,000 have enough money already, or belong to the right oil-golf clubs near by.

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