Shell Prepares for Arctic Drilling, But Loses Key Permit

The NPR has a four-minute clip from Morning Edition discussing Shell’s plans to drill in the Arctic. Journalists from NPR visited the 300-foot cleanup vessel Nanuq, currently harbored at Unalaska. The Nanuq is one of the many response assets included in Shell’s plan in the case of an oil disaster. Although the moratorium on offshore drilling prevented Shell from going ahead with drilling exploratory wells in the Beaufort and Chukchi Seas this past summer, the company is still hoping to begin drilling an exploratory well in Sivulliq N, a location in the Beaufort Sea, during the next open season, which begins in mid-July 2011. Shell is currently postponing plans to to drill in the Chukchi Sea next summer due to legal challenges from environmental and indigenous groups. So far, Shell has spent nearly $3.5 billion on Arctic oil exploration, but has yet to reap any returns.

Shell's Desired Well Locations © Anchorage Daily News 2010
Location of Sivulliq Well in the Beaufort Sea © Anchorage Daily News 2010

In October, Shell submitted a new application to drill in the Beaufort Sea near Camden Bay, which included revised oil spill prevention and response methods based on the lessons it learned from the Deepwater Horizon incident in the Gulf of Mexico. The application was submitted to the Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE), but is still in the process of review.

Shell’s newest plan for oil spill prevention is available here (PDF). Their worst case scenario would involve plugging a well after 38 days (keep in mind that it took 112 days to plug the Deepwater Horizon well). Already, the company has agreed to ship out its drill fluids from its drilling sites in the Arctic. These fluids, which are used to help drill holes into the ground, are usually dumped overboard into the open ocean. However, indigenous groups were highly concerned about the potential ramifications of the fluids on the Arctic ecosystem, which they rely on in part for sustenance. Though the fluids are mostly composed of natural products, they also have some heavy metals.

It is interesting to compare the newest version of Shell’s oil disaster response plan to its 2007 version, entitled, “Shell’s Beaufort Sea Exploratory Drilling Program: Oil Spill Prevention and Response” (PDF). While the newer version has a very specific timeline detailing how the company would respond, the older version goes into more depth explaining the different types of situations in which an oil spill could arise.

Despite the new precautions the company insists it will take, Shell still has a steep hill to climb. Shell was initially awarded clean air permits in April 2010, allowing its ships to operate in the Beaufort and Chukchi Seas. However, environmental and indigenous groups claimed that the permits were too liberal and would allow the company’s drill and support ships to pollute the air.  Their appeal won, as the EAB found that the analysis of the nitrogen dioxide emissions was lacking. The EAB has sent the permits to the Environmental Protection Agency for further review, a major (though not conclusive) blow to Shell’s plans.

News Links

“Federal judge seeks Arctic offshore moratorium answer,” Alaska Dispatch

“Feds pull Shell’s Arctic air permits after challenges,” Fairbanks Daily News-Miner (from the Associated Press)

“Shell scales back 2011 Arctic exploration plan,” Anchorage Daily News (from the Associated Press)

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