Shell's arctic plans get limited go-ahead

Aug. 31, 2012 at 9:21 AM
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WASHINGTON, Aug. 31 (UPI) -- The U.S. Interior Department has granted Shell permission to start limited drilling in the Chukchi Sea off Alaska's coast.

Shell has spent nearly $5 billion and six years preparing to drill in the arctic but has suffered a series of setbacks including most recently, delays in refurbishing the 36-year-old Arctic Challenger spill containment barge, now in a Bellingham, Wash., shipyard.

The authorized preparation work at Chukchi, announced Thursday, includes excavating a 20-by-40 foot mud line cellar, designed to hold a blowout preventer, a device to control runaway wells.

Shell will also be allowed to drill and set the first two strings of casing into shallow non-oil-bearing zones.

U.S. Interior Secretary Ken Salazar stressed Thursday that the approval is limited to specific preparatory work.

"Today's action does not allow Shell to drill into potential oil reservoirs," Salazar said.

"We are holding Shell's feet to the fire. Unless the Arctic Challenger gets certified and has the containment capacity that is required, there will be no penetration in the oil-bearing zones in the arctic, period, end of story."

The Arctic Challenger isn't needed for the initial work, U.S. Deputy Interior Secretary David Hayes said, "because there is not the opportunity for an oil spill."

Shell had initially hoped to drill up to five exploratory arctic wells this summer but has since scaled back its plans to one or two wells. Meanwhile, winter deadlines for encroaching ice are fast approaching.

The U.S. Geological Survey estimates a potential resource of 25 billion-27 billion barrels of oil in the Chukchi and Beaufort seas.

Thursday's approval doesn't affect Shell's drilling plans in the Beaufort Sea.

U.S. Sen. Lisa Murkowski, R-Alaska, who has been a strong advocate of Shell's project, called the approval a "positive step."

"While we would all like to see a discovery this summer, the most important thing is for Shell to continue to make progress and demonstrate once again that arctic drilling can be done safely," the ranking Republican on the Senate Energy and Natural Resources Committee said in a statement.

Environmental groups were highly critical of the approval.

"Secretary Salazar is right to keep repeating that he will hold Shell accountable to make sure drilling in America's arctic is safe," National Resources Defense Council senior attorney Niel Lawrence said in a statement.

"While this is an interim step only, this is like a building inspector letting a developer start construction on a skyscraper on shaky ground before the safety plans are even complete," Lawrence said.

Although Interior's approval was announced on the concluding day of the Republican National Convention, Salazar said "it has nothing to do with any political motivation."

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