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Vol. 17, No. 9 Week of February 26, 2012
Providing coverage of Alaska and northern Canada's oil and gas industry

More OCS appeals

Environmentalists challenge Shell’s Chukchi Sea exploration plan, air permits

Alan Bailey

Petroleum News

Groups opposed to Shell’s plan to drill in Alaska’s Arctic outer continental shelf have filed two new appeals in the U.S. Court of Appeals for the 9th Circuit. On Feb. 13 the Native Village of Point Hope and 11 environmental organizations filed an appeal against the Bureau of Ocean Energy Management’s approval of Shell’s exploration plan for the Chukchi Sea. And on Feb. 17, in the same court, a group of nine environmental organizations appealed the Environmental Protection Agency’s air quality permits for the Noble Discoverer, the drillship that Shell plans to use in the Chukchi Sea, and possibly in the Beaufort Sea.

Other appeals

An appeal against the approval of Shell’s Beaufort Sea exploration plan is already in progress in the 9th Circuit court, with oral arguments scheduled for April 2. And the Environmental Appeals Board, the panel of judges with final authority over Environmental Protection Agency permitting decisions, has yet to rule in an appeal against the air permit for Shell’s use of its Kulluk floating drilling platform in the Beaufort Sea — presumably that appeal could also end up in the 9th Circuit court if the board upholds the permit.

After a multiyear cycle of litigation and appeals over Shell’s air quality permits for its planned Arctic drilling, in January the Environmental Appeals Board rejected an appeal against the Noble Discoverer permits, thus enabling the Environmental Protection Agency to issue the permits. However, the new appeal filed on Feb. 17 moves the appeal process into the federal court system.

In December Congress passed an act transferring the authority for issuing Arctic offshore air permits from the Environmental Protection Agency to the Bureau of Ocean Energy Management, but that act does not apply to Shell’s permits because the Environmental Protection Agency was already processing those permits at the time the act was passed.

Shell plans to drill up to six exploration wells in the Chukchi Sea and up to four wells in the Beaufort Sea, starting in this year’s summer open water season. Briefs have yet to be filed in the Chukchi Sea exploration plan appeal, but in filing the appeal the petitioners say that they are “Alaska Native and conservation groups whose members depend on the ecosystems and wildlife of the Arctic for subsistence, cultural and traditional uses or whose members use and enjoy the affected area for recreational, aesthetic or scientific purposes.”

Controversy

Shell and supporters of Shell’s plans say that the relatively straightforward drilling that the company wants to carry out poses little environmental risk, and that Shell’s comprehensive oil spill response arrangements are more than adequate to deal with an oil spill, in the very unlikely event of an accident. But people opposed to Shell’s Arctic plans say that too little is known about the offshore Arctic environment to risk an accident and that nobody has demonstrated a capability to clean up an oil spill in icy Arctic waters or in severe Arctic weather.

“As early as this summer, the Discoverer drillship and other ships in Shell’s fleet could be in the Chukchi Sea or Beaufort Sea of the Arctic Ocean drilling for oil in some of the harshest conditions on earth,” said Vera Pardee, an attorney with the Center for Biological Diversity, one of the organizations appealing the air quality permits. “Each year, Shell’s massive ships will churn out vast amounts of harmful pollution that will not only damage the Arctic’s fragile ecosystems but accelerate the climate change that’s robbing polar bears and walruses of the sea ice they need to survive.”

Emissions technology

Shell has retrofitted the Noble Discoverer with new emissions control technology and has undertaken a similar upgrade to the Kulluk. The company has committed to the use of ultra-low sulfur diesel fuel for its drilling fleet.

The company has adopted a strategy of fielding a complete, self-contained Arctic oil spill response capability, including ice-capable oil spill response vessels, a 500,000-barrel, ice-strengthened oil tanker, as well as new well capping and oil containment systems. However, the company has also said that its well planning and drilling monitoring arrangements, coupled with the simplicity of its planned wells, make an oil spill accident extremely unlikely.

In approving Shell’s Chukchi Sea oil spill response plan, as reported in this issue of Petroleum News, the Bureau of Safety and Environmental Enforcement has said that it thinks that Shell has adequate resources to deal with any oil spill that might result from its offshore Arctic exploration drilling.



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