Shell likely to receive Arctic offshore permits, Salazar says

Emphasizing that reviews are still under way, US Sec. of the Interior Ken Salazar said Shell Offshore Inc. appears likely to receive permits to begin drilling its Beaufort and Chukchi Sea leases offshore Alaska this summer.

“I anticipate with the conditions Shell has already met, it is highly likely the permits will be issued,” Salazar told reporters during a June 26 teleconference from Trondheim, Norway, where he has been meeting with offshore oil and gas regulators and industry officials from Russia, Canada, Iceland, and Norway. “If that occurs, it will be with the kind of oversight that makes me confident there will not be problems with the wells that are drilled.”

Salazar said the Beaufort and Chukchi seas have some of the nation’s largest undeveloped crude oil resources as indicated by the 30 wells that have been drilled there already. “If they can be developed, they will contribute to the ‘all-of-the-above’ energy strategy this administration is pursuing. But this development will not take place without adequate protections for the environment and local communities,” he maintained.

Shell will have to meet rigorous new requirements if its Arctic offshore operations proceed, Salazar said. It will have to have an inspector from the US Bureau of Safety and Environmental Enforcement on-site 24 hr/day and have a full suite of response capabilities including a capping stack and spill containment systems, he indicated.

He also expects environment and other organizations to sue Interior, the Bureau of Ocean Energy Management, and BSEE if final permits are issued. “We get sued all the time. I am confident the work BOEM, BSEE, and Interior have done will make us prevail,” Salazar said.

‘Capabilities are there’

“But there’s not going to be an oil spill,” he continued. “The scrutiny that’s going to be involved and all the measures that have been taken make a problem unlikely. If there is one, I am confident the capabilities are there to arrest the problem quickly. If I wasn’t, I wouldn’t let this go forward.”

Salazar said that the final 5-year US Outer Continental Shelf program he plans to announce in the next few days will include plans for the offshore Arctic that reflect a different approach from the past. “Specifically, we intend to gather information from industry, Native Alaskan communities, the scientific community, and the public to identify specific high-resource, low-conflict areas that are best suited for exploration and development,” he said.

“This strategy, which is similar to how we now conduct onshore oil and gas lease sales and offshore wind energy planning, will allow us to design potential lease sales in the Arctic in a way that best balances factors like resource potential, subsistence use, and environmental considerations,” Salazar explained. “Specifically, this analysis will help us to design the specific features of Arctic sales—like the size and location of the sale area and the terms and conditions that ensure that any leases are developed responsibly. This will enhance certainty for industry and reduce conflict, litigation, and delays.”

Salazar, who was joined in the teleconference by Deputy Sec. David J. Hayes in Trondheim and BOEM Director Tommy P. Beaudreau in Washington, said the Obama administration’s Arctic offshore resources strategy would be scientifically based and use information from other Arctic countries, the oil and gas industry, and local communities.

“This will involve all the areas with the highest potential,” Beaudreau said. “But we have to maintain our vigilance and go about leasing in all these areas in the right way. The new plan will reflect what is appropriate to leasing offshore. This involves leasing appropriate to each area, particularly off Alaska’s North Slope, which will contain provisions to protect subsistence living there.”

Contact Nick Snow at

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. ...

FourPoint Energy to acquire Anadarko basin assets from Chesapeake

07/02/2015 FourPoint Energy LLC, a privately owned Denver company, plans to acquire oil and gas assets from Chesapeake Energy Corp. subsidiaries Chesapeake Ex...

Puma Energy completes purchase of Murco’s UK refinery, terminals

07/02/2015 Singapore-based Puma Energy Group Pte. has completed its purchase of UK midstream and downstream assets from Murco Petroleum Ltd., a subsidiary of ...

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...

MARKET WATCH: NYMEX oil prices plummet on crude inventory build, Iran deadline extension

07/02/2015 Oil prices plummeted more than $2/bbl July 1 to settle at a 2-month low on the New York market after a weekly government report showed the first ri...

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...

Shell Midstream Partners takes interest in Poseidon oil pipeline

07/01/2015 Shell Midstream Partners LP has completed its acquisition of 36% equity interest in Poseidon Oil Pipeline Co. LLC from Equilon Enterprises LLC, a s...

MARKET WATCH: Oil prices decline as US crude inventories post first gain in 9 weeks

07/01/2015 Oil prices on July 1 surrendered much of their gains from the day before after the release of a government report showing the first rise in US crud...

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 ...
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

Operating a Sustainable Oil & Gas Supply Chain in North America

When Tue, Oct 20, 2015

Short lead times and unpredictable conditions in the Oil & Gas industry can create costly challenges in supply chains. By implementing a LEAN culture of continuous improvement you can eliminate waste, increase productivity and gain end-to-end visibility leading to a sustainable and well-oiled supply chain.

Please join us for this webcast sponsored by Ryder System, Inc.


On Demand

Leveraging technology to improve safety & reliability

Tue, Sep 22, 2015

Attend this informative webinar to learn more about how to leverage technology to meet the new OSHA standards and protect your employees from the hazards of arc flash explosions.


The Resilient Oilfield in the Internet of Things World

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.


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


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