Damaged container dome makes Shell limit Chukchi Sea drilling

Shell Offshore Co. limited its Chukchi Sea activity after its spill containment dome was damaged during a final test on Sept. 14, Royal Dutch Shell PLC reported. It said its subsidiary will not penetrate hydrocarbon-bearing zones for the rest of the 2012 Arctic drilling season, but drill top holes instead.

Shell emphasized that the accident occurred following several successful tests of its Arctic containment system. “It is clear that some days will be required to repair and fully assess dome readiness,” it said Sept. 17 in a statement.

“We are disappointed that the dome has not yet met our stringent acceptance standards, but, as we have said all along, we will not conduct any operation until we are satisfied that we are fully prepared to do it safely,” the company said.

Shell plans to begin drilling its Beaufort Sea leases in the next few days following conclusion of the fall whale hunt and the anticipated receipt of a top hole drilling permit, it added.

Officials from environmental organizations immediately said the containment dome’s damage revealed design defects. “We are relieved to see that Shell is not moving forward to drill in hydrocarbon zones,” said Cindy Shogan, executive director of the Alaska Wilderness League. “However, the [Obama] administration should not be allowing any drilling to go forward without all oil spill response and safety equipment in place.”

Niel Lawrence, a senior attorney at the Natural Resources Defense Council, said, “Shell is proving it is the gang that can’t drill straight. Its spill response barge had hundreds of problems; its drill ship broke anchor and nearly drifted aground while still in harbor; and a day after Shell said it was safe to drill, it had to pull out and run from a 30-mile-wide iceberg.”

Demonstrated capabilities

Shell said the successful movement of one of its drill ships and support vessels out of the path of approaching sea ice reflected its ice management operations’ capabilities. “That drill ship, the Noble Discoverer, is expected to resume its position and drilling operations over the ‘Burger A’ prospect in the days ahead,” it indicated.

The top portions of Chukchi Sea wells drilled in the coming days and weeks will be capped and temporarily abandoned when the Arctic drilling season ends in accordance to regulatory requirements, Shell said.

“We look forward to the final receipt of our drilling permits for the multiyear exploration program upon the successful testing and deployment of the Arctic containment system,” it said.

US Sen. Lisa Murkowski (R-Alas.), the Energy and Natural Resources Committee’s ranking minority member, said Shell’s announcement was disappointing, but added that it was the right decision, keeping safety paramount.

“Arctic oil development is critical to the United States as we pursue independence from [Organization of Petroleum Exporting Countries] imports,” she maintained. “The events in the Middle East over the last week have underscored our urgent need to develop our own abundant oil and gas resources, and Shell and others’ programs in the Chukchi and Beaufort Seas are a fundamental part of that.”

Contact Nick Snow at nicks@pennwell.com.

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