BOEM conditionally approves Shell's Chukchi Sea exploration plan

The US Bureau of Ocean Energy Management conditionally approved Shell Gulf of Mexico Inc.’s revised exploration plan for its leases in the Chukchi Sea off Alaska on Dec. 16. Shell and Alaska government officials immediately questioned the necessity of one condition that would shorten the drilling season there.

A Shell Alaska spokesman said the conditional approval was an important step in the company’s effort to start drilling its Chukchi Sea leases—which it acquired in a 2008 sale—in July 2012. The company is still evaluating the approval’s conditions, including the one that potentially limits the drilling season, he said. “We are concerned this unwarranted restriction could severely impact our ability to deliver a complete Chukchi program,” the spokesman said.

BOEM said the condition was designed to mitigate the risk of an end-of-season oil spill by requiring Shell to leave sufficient time to implement cap and containment operations as well as significant clean-up before the onset of sea ice, in the event of a loss of well control. It said Shell must cease drilling into zones capable of flowing liquid hydrocarbons 38 days before the first-date of ice encroachment over the drill site, given current technology and weather forecasting capabilities.

Based on a 5-year analysis of historic weather patterns, BOEM said it anticipates Nov. 1 as the earliest anticipated date of ice encroachment. The 38-day period would also provide a window for the drilling of a relief well, should one be required, BOEM added.

Additional steps

The company still must satisfy those conditions as well as obtain the US Bureau of Safety and Environmental Enforcement’s approval of its oil spill response plan and well-specific drilling permits, BOEM said. It said Shell also will have to take measures to increase safety and confirm the availability of response equipment, including a well capping and containment system, and to ensure that Shell takes important steps to avoid conflicts with subsistence activities. It also must also obtain necessary permits from the US Environmental Protection Agency, the US Fish & Wildlife Service, and the National Marine Fisheries Service, BOEM said.

Alaska government officials quickly criticized the provision. “I am deeply concerned that curtailing an already-short drilling season will put the entire project in jeopardy, cost jobs, and ultimately result in more dependence on foreign oil, which serves neither Alaska nor our country,” Gov. Sean Parnell (R) said. “This is yet another example of federal regulatory overreach that may unnecessarily hamper economic development for our state, and reduce our ability to produce more domestic energy.”

US Senate Energy and Natural Resources Committee Ranking Member Lisa Murkowski (R-Alas.) suggested that the condition seemed to be more a response to newspaper ads than founded on science. “This arbitrarily curtails an already very short drilling season, unnecessarily putting the project at risk,” she warned.

Alaska’s other US senator, Democrat Mark Begich, called the provision short-sighted and possibly influenced by election year politics. “I am disappointed that the administration has diverted from months of positive progress and thrown this last-minute monkey wrench into Arctic development,” he said. “Alaska has done offshore exploration before, we’ve done it safely, and the technology is better now than it has ever been.”

‘Devil in the details’

Republican Don Young, the state’s at-large US House member, said that while BOEM’s conditional approval might seem positive at first glance, “the devil is in the details.” He said, “What Alaskans and the companies who have invested billions of dollars are looking for is certainty and progress, and unfortunately this ‘conditional’ approval won’t bring much of either. The fact is that Alaskans know how to do this in a safe and responsible way, and to ignore the progress that has been made to increase safety and technology is short-sighted.”

Environmental organizations, meanwhile, condemned BOEM’s conditional approval of Shell’s Chukchi Sea exploration plan as the latest in a series of reckless Obama administration decisions about oil and gas activity in US Arctic Ocean waters.

“BOEM has stuck its head in the sand and rubber stamped Shell’s plan without any thoughtful review or apparent care for our oceans,” said Michael LeVine, Pacific senior counsel for Oceana. “This approval makes a mockery of [US Interior Sec. Ken Salazar’s] stated commitments to science, the legal obligation to be prepared for a spill, and the basic idea of government as stewards of public resources. Every commission, committee, and review other than those prepared by BOEM and the oil industry has shown that we are not ready to drill in the Chukchi Sea.”

Rebecca Noblin, Alaska director for the Center for Biological Diversity, stated, “It’s a sure sign that our thirst for oil has clouded our ability to reason when we start thinking it’s a good idea to drill for oil in the harshest environment on earth. Rather than looking for the next risky fossil fuel fix, the Obama administration should be working to give Americans a clean energy future. A decision to drill in the Arctic is a decision to destroy it.”

Contact Nick Snow at nicks@pennwell.com.

Related Articles

PHMSA proposes pipeline accident notification regulations

07/02/2015 The US Pipeline and Hazardous Materials Safety Administration has proposed new federal oil and gas pipeline accident and notification regulations. ...

BP to settle federal, state Deepwater Horizon claims for $18.7 billion

07/02/2015 BP Exploration & Production Inc. has agreed in principle to settle all federal and state claims arising from the 2010 Deepwater Horizon inciden...

API to issue recommended practice to address pipeline safety

07/01/2015 The American Petroleum Institute expects to issue a new recommended practice in another few weeks that addresses pipeline safety issues, but the tr...

Tullow Oil provides production update on Jubilee, other fields

07/01/2015 Tullow Oil PLC reported that gross production for the Jubilee field offshore Ghana averaged 105,000 b/d in this year’s first half, up from 102,000 ...

FWS issues Shell letter of authorization on Chukchi Sea lease

07/01/2015 The US Fish & Wildlife Service issued Shell Gulf of Mexico Inc. a letter of authorization (LOA) related to the potential disturbance of polar b...

Case for Keystone XL has grown stronger, TransCanada tells Kerry

06/30/2015 Canada is taking strong steps toward combating climate change, and the proposed Keystone XL pipeline crude oil pipeline remains in the US national ...

Court rejects BP, Anadarko Macondo appeals

06/30/2015 BP PLC and Anadarko Petroleum Corp. have lost separate appeals to the US Supreme Court to overturn a lower-court decision expanding their financial...

Senate Democrats outline broad energy goals to nation’s governors

06/30/2015 Forty-five US Senate Democrats outlined broad energy policy goals including more clean energy technology investments, infrastructure improvement, a...

Group suggests principles for Alberta royalty review

06/29/2015 The Canadian Association of Petroleum Producers (CAPP) has suggested that four principles guide Alberta in an oil and gas royalty review planned by...
White Papers

UAS Integration for Infrastructure: More than Just Flying

Oil and gas companies recognize the benefits that the use of drones or unmanned aerial systems (UAS) c...

Solutions to Financial Distress Resulting from a Weak Oil and Gas Price Environment

The oil and gas industry is in the midst of a prolonged worldwide downturn in commodity prices. While ...
Sponsored by

2015 Global Engineering Information Management Solutions Competitive Strategy Innovation and Leadership Award

The Frost & Sullivan Best Practices Awards recognise companies in a variety of regional and global...
Sponsored by

Three Tips to Improve Safety in the Oil Field

Working oil fields will always be tough work with inherent risks. There’s no getting around that. Ther...
Sponsored by

Pipeline Integrity: Best Practices to Prevent, Detect, and Mitigate Commodity Releases

Commodity releases can have catastrophic consequences, so ensuring pipeline integrity is crucial for p...
Sponsored by

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New chall...
Sponsored by

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by

Asset Decommissioning in Oil & Gas: Transforming Business

Asset intensive organizations like Oil and Gas have their own industry specific challenges when it com...
Sponsored by
Available Webcasts


The Resilient Oilfield in the Internet of Things World

When Tue, Sep 22, 2015

As we hear about the hype surrounding the Internet of Things, the oil and gas industry is questioning what is different than what is already being done. What is new?  Using sensors and connecting devices is nothing new to our mode of business and in many ways the industry exemplifies many principles of an industrial internet of things. How does the Internet of Things impact the oil and gas industry?

Prolific instrumentation and automation digitized the industry and has changed the approach to business models calling for a systems led approach.  Resilient Systems have the ability to adapt to changing circumstances while maintaining their central purpose.  A resilient system, such as Maximo, allows an asset intensive organization to leverage connected devices by merging real-time asset information with other critical asset information and using that information to create a more agile organization.  

Join this webcast, sponsored by IBM, to learn how about Internet of Things capabilities and resilient systems are impacting the landscape of the oil and gas industry.

register:WEBCAST



On Demand

Taking the Headache out of Fuel License and Exemption Certificates: How to Ensure Compliance

Tue, Aug 25, 2015

This webinar, brought to you by Avalara, will detail the challenges of tax document management, as well as recommend solutions for fuel suppliers. You will learn:

-    Why it’s critical to track business partner licenses and exemption documents
-    The four key business challenges of ensuring tax compliance through document management
-    Best practice business processes to minimize exposure to tax errors

register:WEBCAST


Driving Growth and Efficiency with Deep Insights into Operational Data

Wed, Aug 19, 2015

Capitalizing on today’s momentum in Oil & Gas requires operational excellence based on a clear view of what your business data is telling you. Which is why nearly half* of oil and gas companies have deployed SAP HANA or have it on their roadmap.

Join SAP and Red Hat to learn more about using data to drive process improvements and identify new opportunities with the SAP HANA platform running on Red Hat Enterprise Linux. This webinar will also show how your choice of infrastructure impacts the performance of core business applications and your ability to achieve data-driven insights quickly and reliably.

*48% use SAP, http://go.sap.com/solution/industry/oil-gas.html

register:WEBCAST


OGJ's Midyear Forecast 2015

Fri, Jul 10, 2015

This webcast is to be presented by OGJ Editor Bob Tippee and Senior Economic Editor Conglin Xu.  They will summarize the Midyear Forecast projections in key categories, note important changes from January’s forecasts, and examine reasons for the adjustments.

register:WEBCAST


Emerson Micro Motion Videos

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected