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Vol. 16, No. 19 Week of May 08, 2011
Providing coverage of Alaska and northern Canada's oil and gas industry

Shell having another go

Company filing plans to drill up to 10 wells in the Arctic OCS starting in 2012

Alan Bailey

Petroleum News

After several years of frustration in its attempts to start an exploration drilling program in Alaska’s Beaufort and Chukchi seas, Shell is in the process of filing new exploration plans for the drilling up to 10 wells, starting in the open water season of 2012.

The plans will entail the drilling of up to two wells per year in the Beaufort Sea and up to three wells per year in the Chukchi Sea, using the drillship Noble Discoverer and the Kulluk floating drilling platform, Shell spokesman Curtis Smith told Petroleum News in a May 2 e-mail.

The company filed its Beaufort Sea plan on May 4, with the Chukchi Sea plan expected to follow within a few days.

Two prospects

According to the Beaufort Sea exploration plan, Shell proposes drilling two wells in its Sivulliq prospect and two wells in its Torpedo prospect, with both prospects being located on the west side of Camden Bay, east of Prudhoe Bay. Sivulliq is the location of a known oil field, previously called Hammerhead.

“As with any Arctic exploration drilling program, weather and ice conditions, among other factors, will dictate the actual sequence in which the wells are drilled. All wells are planned to be vertical,” the exploration plan says.

Shell has two drilling vessels available for use — the drillship Noble Discover and the floating drilling platform, the Kulluk — but says that it has not yet made a final decision on which of these vessels to use in the Beaufort. In March, Pauline Ruddy, Shell regulatory affairs team lead, told the National Marine Fisheries Service Open-water Meeting that the company would likely use the Kulluk for drilling in the Beaufort Sea and the Noble Discoverer for drilling in the Chukchi Sea.

Discharges to be removed

Under the terms of an agreement with the North Slope communities, Shell plans to barge some of the Beaufort Sea waste streams out of region, rather than dispose these waste streams into the ocean. Waste stream to be barged out consist of sanitary waste; domestic waste; bilge water; ballast water; and drilling mud and cuttings from drilling operations below the depth of a well’s 20-inch conductor shoe.

Shell also plans to upgrade the Kulluk’s emissions technology to meet air quality standards.

The drilling vessel would be attended by a minimum of 11 support vessels for ice management, anchor handling, refueling and other tasks, the exploration plan says.

Exploration drilling would start around July 10 and continue through October 31. However, operations would be suspended, with all vessels departing the drilling area, during subsistence whale hunts that would start in late August.

Whichever vessel is used in the Beaufort, the other vessel would be available for relief well drilling, in the unlikely event of a well blowout. Shell has also been planning the construction of a containment dome that could be placed over an Arctic offshore well to contain any oil leak in the event of a well control problem.

Burger prospect

During the NMFS Open-water Meeting Ruddy said that in the Chukchi Sea Shell plans to target the Burger prospect, a 25-mile-diameter structure that is known to hold a major natural gas pool some 80 miles offshore the western end of Alaska’s North Slope.

For its Arctic drilling program, Shell still needs air quality permits from the Environmental Protection Agency. These permits are still on remand from the Environmental Appeals Board, following an appeal by Native Village of Point Hope and eight environmental organizations against the issuance of the permits.

There is also legal uncertainty regarding Chukchi Sea drilling because of an unresolved appeal case in Alaska district court against the 2008 Chukchi Sea lease sale in which Shell purchased its Chukchi Sea leases. The Bureau of Ocean Energy Management, Regulation and Enforcement is in the process of developing a supplementary environment impact statement for the lease sale, in response to a court order in that appeal.

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