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Shell clears major US government hurdle for Arctic drilling

Created: 05/12/2015 7:22 AM
By: By MARK THIESSEN

ANCHORAGE, Alaska (AP) — Royal Dutch Shell's Arctic drilling program has cleared a major bureaucratic hurdle to begin drilling for oil and gas off Alaska's northwestern coast this summer.

The Bureau of Ocean Energy Management on Monday approved the multi-year exploration plan in the Chukchi Sea for Shell after reviewing thousands of comments from the public, Alaska Native organizations and state and federal agencies.

The approval came just days before a planned protest of the drilling program in Seattle.

Shell must still obtain other permits from state and federal agencies, including one to drill from the Bureau of Safety and Environmental Enforcement. Both BOEM and BSEE are agencies of the U.S. Department of Interior. The company must also obtain government opinions that find Shell can comply with terms and conditions of the Endangered Species Act.

Shell spokesman Curtis Smith said the approval "is an important milestone and signals the confidence regulators have in our plan. However, before operations can begin this summer, it's imperative that the remainder of our permits be practical, and delivered in a timely manner.

"In the meantime, we will continue to test and prepare our contractors, assets and contingency plans against the high bar stakeholders and regulators expect of an Arctic operator," Smith said in an email to The Associated Press.

The Bureau of Ocean Energy Management's director, Abigail Ross Hopper, said in a statement that officials recognize "the significant environmental, social and ecological resources in the region" and have established "high standards for the protection of this critical ecosystem, our Arctic communities, and the subsistence needs and cultural traditions of Alaska Natives."

"As we move forward, any offshore exploratory activities will continue to be subject to rigorous safety standards," she said.

The Port of Seattle would need to get another permit to base the Arctic drilling fleet in Seattle for about six months of the year.

Meanwhile, Smith said that a giant floating oil rig currently anchored off Port Angeles, Washington, will be towed to Seattle this week despite the Seattle mayor's assertion that the Port of Seattle can't host the rig until it gets a new land-use permit.

Smith said in another email that the 400-foot-long Polar Pioneer was scheduled to arrive at the Port of Seattle's Terminal 5 "later in the week" to prepare for planned exploration in the Arctic Ocean.

Smith said his company believes its arrangements to use the terminal are valid and disagrees with Seattle's interpretation.

Seattle Mayor Ed Murray has urged the port to reconsider its two-year, $13 million lease with Foss Maritime, a company whose client is Shell.

Activists plan to protest. A so-called "festival of resistance" starts Saturday and will include protesters on land and in kayaks, trying to block the ship's movements.

Environmental groups on Monday blasted the Bureau of Ocean Energy Management for providing the permit to Shell.

"This decision places big oil before people, putting the Arctic's iconic wildlife and the health of our planet on the line," Erik Grafe, an attorney for Earthjustice, said in a statement. "The agency should not be approving such threatening plans based on a rushed and incomplete environmental and safety review. Ultimately, Arctic Ocean drilling is far too risky and undermines the administration's efforts to address climate change and transition to a clean energy future."

Shell's drilling plan proposes to drill up to six wells within the Burger Prospect, located about 70 miles northwest of the village of Wainwright, Alaska. The wells would be drilled in about 140 feet of water by the Polar Pioneer and the Noble Discoverer. Both vessels would provide relief-well capability for the other.

Shell has said the two ships will leave the Chukchi Sea at the end of each drilling season.

Arctic offshore reserves are estimated at 26 billion barrels of recoverable oil and 130 trillion cubic feet of natural gas, according to U.S. Geological Survey estimates.

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Associated Press reporter Phuong Le in Seattle contributed to this report.

(Copyright 2015 by The Associated Press. All Rights Reserved.)



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