San Joaquin Basin

Approximately 70 percent of California Resources Corporation’s (CRC) estimated proved reserves as of year-end 2015 are located in the San Joaquin Basin. We actively operate and develop 45 fields in this basin consisting of conventional primary, improved oil recovery, enhanced oil recovery and unconventional project types. We hold approximately 1.6 million net acres in the San Joaquin Basin, approximately 62 percent of which we hold in fee.

According to the California Department of Conservation’s Division of Oil, Gas and Geothermal Resources (DOGGR), approximately 74 percent of California’s daily oil production for 2014 was produced in the San Joaquin Basin. Commercial petroleum development began in the basin in the late 1800s when asphalt deposits were mined and shallow wells were hand dug and drilled in the Coalinga, McKittrick and Kern River areas. Rapid discovery of many of the largest oil accumulations followed during the next several decades, including the Elk Hills Field. According to the U.S. Geological Survey as of 2012, the San Joaquin Basin contained three of the 10 largest oilfields in the United States based on cumulative production and proved reserves. Most discovered oil accumulations occur in Eocene-age through Pleistocene-age sedimentary sections. Source rocks are organic-rich shales from the Monterey, Kreyenhagen and Tumey formations.

In the 1960s, the introduction of thermal techniques resulted in substantial new additions to reserves in heavy oil fields. CRC has been successfully developing steamfloods in its Kern Front operations, which are located next to the giant Kern River Field, and in the northwest portion of the Lost Hills Field. The complex stratigraphy and structure in the San Joaquin Basin has allowed continuing discoveries of stratigraphic and structural traps. We believe our extensive 3D seismic library, which covers nearly 3,000 square miles in the San Joaquin Basin, covering approximately 50 percent of our San Joaquin acreage, will give us a competitive advantage in further exploring this basin.

We have established a large ownership interest in several of the largest existing oilfields in the San Joaquin Basin, including Elk Hills, our largest producing field, as well as the Buena Vista and Kettleman North Dome fields.