OK, so last year was a nightmare for the officials at Shell charged with figuring out how to plunder the Arctic for oil. Shell gets that. Both of the company’s exploratory oil rigs in the region were damaged in accidents, wells were abandoned, a vice president lost his job, and the Obama administration prevented the company from resuming its Arctic work this year.
But Shell is delighted to announce that its problems have largely been fixed and it’s ready to return to some American-controlled Arctic waters next year. From E&E Publishing:
In a teleconference with energy analysts, Shell Chief Financial Officer Simon Henry said the company will submit an exploration plan for the Chukchi “in the next few weeks.” Shell officials added, however, that the company has not yet reached a final decision on drilling.
Although Shell is moving forward in the Chukchi [the waters just north of the Bering Strait, and to the west of the more northerly Beaufort Sea], the company is postponing its Beaufort Sea operations for the foreseeable future.
Henry said the company also expects to abandon its battered drill rig the Kulluk and will take a write-off “of a few hundred million in the fourth quarter” of this year if the rig is scrapped.
Shell is taking a renewed look at Alaska a year after the company spent more than $5 billion in an unsuccessful campaign to explore in the Chukchi and Beaufort seas. …
Despite last year’s problems, Henry said the company is eager to gauge the size of the oil reserves on its Chukchi leases. The Interior Department estimates that the region could hold 12 billion barrels of recoverable oil.
Shell wants us to know that everything will probably be peachy, but Earthjustice attorney Holly Harris isn’t ready to buy the oil-industry promises:
Before Shell starts boasting about its new plans for the drilling in the Arctic Ocean, the company should explain why it couldn’t safely conduct its operations under last year’s plans. We’ve already watched Shell lose control of two different drill rigs in less than a year, with one of them catching fire and the other one running aground off the coast of Alaska. The federal government chastised Shell earlier this year that it needed to answer ‘serious questions regarding its ability to operate safely and responsibly in the challenging and unpredictable conditions’ of the Arctic Ocean. We’re still waiting for those answers. Drilling in the Arctic Ocean is just too risky and no company has figured out how to respond to an oil spill in icy waters.
Drilling in the Arctic Ocean would also take us in the wrong direction when it comes to addressing the challenges of climate change … The president can make a generational commitment to take action against the devastating effects of climate change by leaving the oil in the ground and preventing oil drilling in the pristine waters of the Arctic Ocean.
Time will tell whether the Obama administration sides with hopeful Shell officials or with skeptical environmentalists.
Offshore drilling: Shell will return to Arctic in 2014, E&E Publishing.
Shell Plans to Drill in The Arctic in 2014, Earthjustice.
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