Oil concerns stand to lose use of millions of barrels of offshore oil.

Oil companies may lose access to 350 million to 750 million barrels of oil buried beneath state lands offshore, if Gov. Pete Wilson signs a bill which would ban off-shore drilling, a lobbyist for the oil industry told the Business Journal last week.

The bill, AB 2444, sponsored by Assemblyman Jack O'Connell, D-Carpinteria, calls for the entire state coastline to be declared a sanctuary where oil drilling would be prohibited. It was passed by both houses of the state Legislature last month and awaits Gov. Wilson's signature. He has until Sept. 30 to veto or sign it.

Sacramento insiders told the Business Journal that Wilson -- who has a long record of opposing offshore drilling -- is expected to sign it into law in the last week of September.

Under the bill, oil companies would still be able to extract oil under leases already in place. About 95 percent of the 1,100-mile-long and three-mile-wide coastline is currently not under any oil lease.

The bill also would allow oil companies to apply to the state to extend existing leases, said Carla Frisk, aide to O'Connell. Mobil Corp. is expected to apply sometime this fall to extend its lease to drill into an undeveloped underwater oil field off the Santa Barbara coast, said Bill Douros, manager of Santa Barbara County's energy division. That field is believed to contain about 150 million barrels of oil, Douros said.

The bill is considered landmark legislation because it would mark the first time the entire California coastline -- with the exception of the small portions of the coastline in oil leases -- has been designated a sanctuary. Previously, the state had authorized "a confusing hodgepodge" of separate sanctuaries covering different parts of the coastline, according to a statement from O'Connell's office.

John Geoghegan, a lobbyist for the Western States Petroleum Organization, said his group is lobbying Wilson to veto the bill. To forever ban the entire coastline from oil drilling is "stupid" public policy, he said.

Geoghegan noted the state produces about 900.000 barrels of oil a year, but consumes about 2 million barrels. As the amount of oil produced in the state declines, more must be imported by tanker.

Accidents are more prevalent for oil tankers than for offshore oil platforms, he said.

Frisk said a major reason O'Connell sponsored the bill was to avoid any oil drilling accidents like the one that occurred on a platform off Santa Barbara in 1969, which dumped thousands of barrels of oil into the sea, killing sea life and polluting Santa Barbara beaches.

But she cited other reasons: Offshore rigs cause air pollution and are dangerous operations for workers, Frisk said.

She added that the bill has a provision which would lift the ban in the event of a national emergency.

Geoghegan said WSPA estimates that oil companies would lose access to 350 million to 750 million barrels of oil if Wilson signs the bill.

Professor Iraj Ershaghi, director of the petroleum engineering program at USC, said that WSPA estimate may be conservative.

Ershaghi noted there has not been much oil exploration and discovery activities in California waters because of restrictions enacted shortly after the 1969 Santa Barbara oil spill.

In addition to WSPA, the California Chamber of Commerce opposes the bill. Twenty-nine groups, including the Sierra Club, the Pacific Coast Federation of Fishermen's Associations, the Greater Santa Barbara Lodging Association and the American Oceans Campaign, support the bill.

Joe Caves, a lobbyist representing several environmental groups supporting the bill, did not return repeated telephone inquiries.