Shell files revised Arctic offshore drilling plan

August 28, 2014 - 6:04 PM

ANCHORAGE, Alaska (AP) — Royal Dutch Shell PLC has filed a revised Arctic offshore drilling plan with federal regulators but says the company hasn't decided whether to return to waters off the coast of northwest Alaska in 2015.

The revised exploration plan submitted to the Bureau of Ocean Energy Management in Anchorage calls for two drilling vessels to operate simultaneously in the Chukchi Sea rather than one in the Chukchi and one in the Beaufort Sea off Alaska's north Coast.

The presence of two vessels is required so one can drill a relief well in the event of damage from a blowout.

Shell Gulf of Mexico Inc.'s revised plan calls for the return of the Noble Discoverer, which performed top hole work at the company's Burger prospect in 2012. The second drilling vessel planned for the Chukchi is the Polar Pioneer, owned by Transocean Ltd., said Shell Alaska spokesman Curtis Smith.

"Today's filing is not a final decision to drill next summer, but it does preserve the option," he said by email.

In 2012, Shell drilled pilot holes and dug mudline cellars in the Chukchi and Beaufort seas. The company was not allowed to drill into oil-bearing deposits because required response equipment was not on hand.

The company experienced problems in the challenging Arctic conditions, culminating with the drill vessel Kulluk running aground off an island near Kodiak as it was being towed across the Gulf of Alaska in stormy weather.

Shell chose not to drill during the short open water drilling season in 2013 or 2014, and it faces regulatory hurdles if it wants to send its drill fleet north again.

Besides obtaining necessary permits, Smith said, there has to be a resolution to the legal cloud hanging over the 2008 Chukchi lease sale. A federal appeals court in January ruled that the federal government conducted a flawed environmental review before selling $2.7 billion in Chukchi leases. The Bureau of Ocean Energy Management is conducting supplemental environmental work.

In a statement, Greenpeace spokesman John Deans condemned future Shell drilling and said the company's Arctic bungling had put the region at risk.

Smith said Shell plans to fortify its fleet with more anchor handlers, new tugs, additional offshore supply vessels and an extra helicopter. The company is taking a methodical approach in making decisions, he said.

"We have to have total confidence we can execute a program safely," Smith said.