Shell Faces Shrinking Window for Arctic Drilling

Wednesday, July 18 2012

Shell had planned to start drilling in the Arctic this week, but persistent sea ice and a number of last-minute stumbling blocks have delayed those plans indefinitely.

The company says sea ice forecasts look favorable starting the first week of August, but Interior Secretary Ken Salazar told The New York Times Tuesday that his agency might not issue final permits for Shell’s summer drilling plans until August 15 – if at all.

The agency is holding off until Shell’s oil spill containment barge is certified. Regulators said earlier this month that the barge doesn’t meet the requisite standards as it stands.

Shell is also waiting to hear back from the EPA about proposed revisions to the Noble Discoverer’s air permits. The company says it’s simply not possible to achieve the standards mandated by the permit. The EPA is reviewing the proposed changes, but it could be several weeks before they decide whether to accept them or not.

Shell spokesperson Curtis Smith is confident that both permitting issues will be resolved this summer, but he says it does cut into an already short drilling window.

“Because of the lingering sea ice alone, we’ve been forced to recalibrate our expectations in terms of the number of total depth wells we can drill in the offshore. We don’t have a specific number at this point, but it will likely be, of course, less than we had originally planned.”

Shell was hoping to drill five total exploratory wells - three in the Chukchi and two in the Beaufort. Each well is expected to take 30-40 days. Combined with the mandatory end of drilling in the Chukchi by late September and late October in the Beaufort, that means two to three wells are more likely at this point.

In the meantime, Shell’s entire fleet is parked in Unalaska, waiting for word as to whether they’ll be headed north this summer, or whether their Arctic drilling plans will have to wait another year.

Alex on Thursday, July 19 2012:

Its ironic isn't it that environmentalists are saying the polar caps are melting and ice is receding and this activity will only exacebate it but the ice season this year is heavier and longer than expected.

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