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BOEMRE opts to assess Chukchi Sea spill Action to add very large oil spill assessment to lease sale SEIS will delay resolution of appeal until at least late October Alan Bailey Petroleum News
Just as it appeared that resolution of an appeal in the Alaska District Court against the 2008 Chukchi Sea outer continental shelf lease sale might finally be in sight, the appeal case took a new twist March 4 when the Bureau of Ocean Energy Management, Regulation and Enforcement announced that it has opted to add a very large oil spill assessment to the supplementary environmental impact statement for the sale.
2010 court order In July 2010 the court ordered BOEMRE to revise the original EIS for the lease sale in response to an appeal against the sale by the Native Village of Point Hope, the Inupiat Community of the Arctic Slope and 12 environmental organizations. And the court has banned Chukchi Sea lease related activities until the appeal is resolved.
Shell, ConocoPhillips and Statoil are all actively pursuing exploration programs in leases that they purchased in the 2008 sale but will not be able to carry out any drilling in their leases unless the court determines that BOEMRE has prepared a legally acceptable SEIS.
In the July 10 order Judge Ralph Beistline said that MMS, the predecessor agency to BOEMRE, had acted in an arbitrary manner in preparing the lease sale EIS by not considering the potential environmental impact of offshore natural gas development (as distinct from oil development), by not determining whether environmental information missing from the EIS was relevant or essential for consideration and by failing to present an assessment of the cost or difficulty of obtaining the missing information.
In October BOEMRE published a draft SEIS for public review, saying that the new SEIS had addressed the deficiencies that the court had listed in its July order. But, with BOEMRE subsequently receiving more than 150,000 comments on the SEIS, the agency has spent several months working on the document since the public comment period ended.
Response to public comments But by conducting a new oil spill assessment in response to concerns raised in public comments on the draft SEIS, BOEMRE is going beyond the requirements of Judge Beistline’s order.
“Due to the Deepwater Horizon oil spill, many commenters requested an analysis that takes into account the possibility of a blowout during exploration,” wrote David Glazer of the U.S. Department of Justice in a status report submitted to the court March 4. “After reviewing those comments, BOEMRE has determined that it is appropriate to update its spill risk assessment and provide a very large oil spill (“VLOS”) analysis from an exploration well blowout as part of this SEIS.”
BOEMRE now anticipates releasing a new draft SEIS by late May for public review, with the public review period ending in early July and final record of decision on the new SEIS likely in late October, Glazer wrote.
The new oil spill analysis will “promote the agency’s decision-making on remand and aid any future environmental reviews and decisions” for Chukchi Sea leases, he wrote.
Shell evaluating situation Shell is still evaluating the potential impact on the company’s 2012 plans for the Chukchi Sea following BOEMRE’s decision, Shell spokesman Curtis Smith told Petroleum News March 7.
“It’s fair to say that the announcement is extremely troubling and could potentially impact thousands of jobs, future energy security and the economic stimulus that would result from offshore development,” Smith said.
Smith said that Shell is particularly concerned that the new schedule for completion of the Chukchi Sea SEIS is inconsistent with what the court has ordered. Shell has already done significant oil spill scenario planning — the company considered all realistic oil spill scenarios before building a world-class Alaska oil spill response fleet, Smith said.
“Shell has made every effort to cooperate with BOEMRE at all levels so it’s surprising to learn of this significant change in timeframe,” Smith said. “Our issue is not with best practices being applied to the Arctic, because Shell supports a high bar and we take pride in exceeding it. Our issue is with the Department of Interior constantly moving the goal posts when it comes to the offshore. These constant delays seriously threaten our ability to make long term plans for Alaska.”
Environmentalist support Referencing reported difficulties in recovering oil spilled from a container ship that recently ran aground in sea-ice conditions off the southern coast of Norway, Leah Donahey, western Arctic and oceans program director for Alaska Wilderness League, praised BOEMRE’s decision.
“We are glad that BOEMRE is applying lessons learned from the Deepwater Horizon disaster to the Arctic Ocean, by incorporating the impacts of a very large oil spill into their new analysis,” Donahey said. “However, as we saw with last month’s oil spill in Norway, the Arctic comes with its own unique set of challenges. BOEMRE must take into account the fact that — as painfully illustrated in Norway where more than 200 birds have been shot after being drenched in oil — there is no known way to clean up a spill in the Arctic’s icy, extreme conditions.”
Shell, for its part, has consistently argued that it can drill safely in the Chukchi.
The company has assembled a spill response fleet, including a purpose-built oil spill response vessel, and has committed to build an oil spill containment dome for its planned Chukchi Sea drilling. The company has said that, because Chukchi Sea exploration wells will be drilled in shallow water into relatively low-pressure reservoirs, the Chukchi Sea drilling will be much less risky than deepwater drilling in the Gulf of Mexico.
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