February 17, 2012

With Obama's OK, Shell may soon start drilling for oil in arctic

The Associated Press

(Continued from page 1)

Shell's Chukchi wells are proposed for the Burger Prospect, about 70 miles offshore in about 140 feet of water. Slaiby has said the site presents far fewer technical challenges and cannot be compared to the deep-water drilling and high pressures involved in the Deepwater Horizon blowout.

James A. Watson, director of the Bureau of Safety and Environmental Enforcement, said Shell's plan underwent an exhaustive review and his agency had confidence that the company can pre-stage equipment and personnel for effective spill response.

Alaska's elected officials praised the decision. Upward of 90 percent of state government revenue is tied to the oil industry, but the trans-Alaska pipeline has been running at less than one-third capacity as North Slope oil fields have matured and reserves have dwindled.

Sen. Mark Begich, D-Alaska, said the announcement showed the federal government is preparing for short-term emergency response as well as long-term science for responsible development of Arctic resources.

"Alaskans should be assured the federal government is taking this seriously and has plans in place," he said.

Sen. Lisa Murkowski, R-Alaska, congratulated the Interior Department.

"Today's decision confirms what we've known for some time — that Shell has put together a robust and comprehensive spill prevention and response plan that offers the highest level of environmental protection," she said.

Yet, Shell faces other hurdles.

The federal government approved Shell's Chukchi Sea exploration plan with the condition that the company stop drilling into hydrocarbon zones 38 days before sea ice forms around the lease area. The condition was put in place so Shell would have time to fix a wellhead blowout while operating in open water. However, the requirement cuts a 105-day open water drilling season down by 38 days. Shell is seeking to reverse the decision.

Shell plans to use the drill ship Noble Discoverer in the Chukchi. The vessel is drilling a well in New Zealand before a trip to the West Coast for modifications.

Shell is awaiting a decision on an appeal by environmental groups of EPA air permits for a second drill ship, the Kulluk, which Shell will use for Beaufort Sea drilling. The Kulluk also could drill a relief well in the Chukchi Sea if a blowout disabled the Noble Discoverer.

The Kulluk is undergoing upgrades in Seattle, including replacement of its engines to make them compliant with air standards.

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