Smaller Oil Companies Find Riches Still Remain : Business: They mine wells large producers have abandoned. One company brought production from 25 barrels daily to more than 580.

Scrappy independent oil companies are showing renewed interest in Ventura County’s aging oil wells, snatching them up from major oil companies and squeezing more barrels from the ground than the oil giants thought was possible or cost effective.

Industry officials say smaller, independent firms with lower overhead costs can better afford to upgrade wells that the larger oil producers are ready to abandon.

The financial gamble of several independent companies has paid off, signaling what could turn into an oil boomlet in this region once dominated by oil and gas production.

Most recently, Bush Oil Co. disclosed that retooling four oil wells near McGrath State Beach increased production from 25 barrels a day to more than 580 daily barrels of crude. The Taft, Calif.-based independent bought the wells from Chevron, which had shut them down.

“They kicked up the production significantly,” said Al Williard, supervising engineer of the State Lands Commission, which oversees oil leases in California. “It’s not a barn burner, but it can be considered a success. It’s prolonging the life of an older field.”

This week, Bush Oil officials plan to test production of a fifth well, and will soon begin upgrading three more wells, which the company hopes will increase production to more than 1,000 barrels per day by the end of the year.

Ventura County’s oil production has fallen to only a third of its peak of nearly 50 million barrels a day in the late 1950s, and few new wells are being drilled, eliminating many of the oil-related jobs.

But some independent oil producers envision a small rebound in the industry, reworking old wells to draw the final 10% of oil that remains underground.

“As far as the big companies are concerned, they’re done in Ventura County,” said Ron Klarc, division manager for Bush Oil. “But I don’t think Ventura County’s oil industry is dead, it’s just taking a different turn.”

Klarc thinks his company’s leases of McGrath State Beach wells have 10 or 20 more years left of production before they run dry, plenty of time for Bush Oil to profit from its $1.8-million cost of upgrading the wells. These 220 acres of oil deposits lie just off the coast of McGrath State Beach. Using slant drilling techniques, Bush reached the fields by drilling 14,000 feet down and 4,000 feet out to sea.

More and more independent oil companies said they have begun moving into the county over the past two years, probing for profits in oil fields that the major companies want to leave behind.

Representatives for large oil companies such as Chevron and Texaco agree that untapped oil remains trapped beneath Ventura County; however, they say the underground fields are not big enough to support hefty profits needed to keep larger companies interested.

Texaco, Chevron, Mobil and Shell have slashed or eliminated their Ventura County operations in the past decade. Chevron has decimated its work force from 400 in 1985 to fewer than 100 workers now. Exxon last month announced that it will close its West Coast production headquarters in Thousand Oaks and relocate 150 employees.

“With a smaller company with reduced overhead costs, like Bush Oil, this could be a nice little niche for them,” Chevron spokesman G. Michael Marcy said. “It’s not worth it for large companies.”

In addition to Bush’s activities in the Montalvo oil fields near McGrath State Beach, other evidence of an oil resurgence include:

* Seneca Resources, which has 130 oil wells in the county, is trying to drill another well near Lake Piru.

* Benton Oil & Gas, an Oxnard-based company with oil interests overseas, has entered negotiations to buy its first group of wells in undisclosed areas of Ventura County.

* Santa Fe Energy Resources, which has 245 operating oil wells in the county, is also looking at buying more interests in oil fields.

“We have actively pursued properties from the majors,” said Jim Beck, general manager for Seneca Resources, a wholly owned subsidiary of Buffalo-based National Field Gas. “We think there is oil bypassed by the major oil companies that we can go in and get.”

Beck estimated that the major companies have left up to 10% of the oil in the fields for the independents to pick over.

He also complained about the county’s strict air pollution and other environmental rules, but said his company’s move into the county “has been a good investment.”

Ed Hall, spokesman for Santa Fe Energy Resources, said, “Ventura County has been good to us. We have enhanced our position there.”

Eric Johnson, board member of the trade association Independent Oil Producers Agency, predicted that Bush Oil’s success would prompt other independent oil companies to take a hard look at Ventura County.

“Those companies are going to look at what the fellow across the fence has done and see if that’s applicable to their reservoir,” Johnson said. “There’s probably a substantial amount of oil remaining in the place.”