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Vol. 17, No. 12 Week of March 18, 2012
Providing coverage of Alaska and northern Canada's oil and gas industry

Taking shape for Shell

Company moving forward on plans for Chukchi and Beaufort drilling this year

Alan Bailey

Petroleum News

The path toward Shell’s hoped for drilling in the Chukchi and Beaufort seas is still pitted with legal actions and appeals against some of the permits that the company needs, but Shell seems confident that 2012 will prove to be the year in which its plans to drill in the Alaska Arctic outer continental shelf will come to fruition.

And on March 7 at the National Marine Fisheries Service’s annual Arctic Open Water Meeting, Michael Macrander, Shell’s science team lead in Alaska, said that the company hopes to drill up to three wells in the Chukchi Sea Burger prospect and up to two wells in the Beaufort Sea Sivulliq and Torpedo prospects during the 2012 open water season, between July and the end of October.

Promising prospects

Burger is a structure 25 miles in diameter about 80 miles offshore the western end of the North Slope and known to contain a major pool of natural gas. Shell thinks that the structure also has the potential for a significant oil find. Sivulliq, formerly called Hammerhead, lies due north of Flaxman Island on the western side of Camden Bay, to the east of Prudhoe Bay. The prospect contains a known oil pool penetrated by two exploration wells drilled by Unocal in 1985 and 1986. Torpedo lies a few miles northeast of Sivulliq.

Shell anticipates using the drilling vessel Noble Discoverer in the Chukchi Sea and the Kulluk floating drilling platform in the Beaufort Sea. Each of these drilling units will be supported by a fleet of vessels, including oil spill response assets capable of moving into action within one hour of any oil spill incident. The primary oil spill response vessel for the Chukchi Sea will be the Nanuq, an ice-capable vessel that Shell commissioned for its Alaska operations. The Endeavor ice-capable oil spill response barge and a supporting tug will perform the equivalent role in the Beaufort Sea, Macrander said.

Shell will position a 500,000-barrel ice-capable tanker somewhere near a midpoint between the Chukchi Sea and Beaufort Sea drilling operations for the storage of recovered oil in the event of an oil spill accident. And, at about the same location, the company will station a vessel with a new oil containment system and well capping stack, for use should there be a well blowout following a well blowout preventer failure. This new equipment is modeled on the technology used to eventually seal off the Gulf of Mexico Macondo well, following the 2010 Deepwater Horizon disaster.

It would probably take eight to 10 hours to move the barge holding the capping and containment systems to a drill site, Macrander said. And, if a drilling rig in one drilling operation were to become incapacitated following a well blowout, the rig in use at the other operation would provide relief well drilling services to bring the well under long-term control — it would likely take 48 to 72 hours for a rig to transit the distance between the Beaufort Sea and Chukchi Sea operations, Macrander said.

Exclusion zones

Under the terms of Shell’s Environmental Protection Agency air quality permits there will be a 25-mile exclusion zone around each drilling vessel, with only certain vessels allowed within each zone, Macrander explained.

“The air emissions within those zones have to be very, very carefully controlled and monitored,” Macrander said.

And, following up on a commitment to North Slope stakeholders, Shell is going to remove from the Arctic drilling waste streams, other than cooling water, from its Beaufort Sea drilling operation — two barges with accompanying tugs will perform the waste removal.

Macrander said that Shell will conduct comprehensive environmental monitoring programs around its drill sites, before, during and after drilling, to test for any environmental impacts. By conducting this monitoring in both the Chukchi and Beaufort seas it will be possible to identify any impact from the permitted discharges in the Chukchi Sea while also comparing the results in the Chukchi Sea with those in the Beaufort Sea, where the waste streams are being removed, he said.

And a program to characterize the sounds generated by each vessel in Shell’s fleet will ensure that vessel noise does not exceed levels for the harassment of marine animals.

Avoid whale hunts

Under the terms of a conflict avoidance agreement with North Slope subsistence whalers Shell will stop its Beaufort Sea drilling operations by midnight on Aug. 25 and remove the drilling rig and support vessels from the drilling area until after the completion of the Kaktovik and Nuiqsut whale hunts. Shell also has a communication plan for avoiding conflicts with subsistence hunting and has committed to communicating with appropriate stakeholders before initiating any vessel transit. Shell will hire local subsistence advisers in most coastal villages to notify Shell of potential conflicts with subsistence hunting activities, and several villages will also have community liaison officers as avenues of communication, Macrander said.

Shell visited many North Slope villages in 2011 to obtain feedback on its plans and anticipates conducting a similar round of visits shortly, Macrander said.

Marine mammal monitoring

As part of its mitigation measures to monitor wildlife and minimize environmental disturbance, Shell is implementing a marine mammal observer program involving a workforce of about 150 people, with observers on the drilling rigs and on all of the support vessels, Macrander said. About half of that workforce will comprise experienced local people, with the other half consisting of specialist scientists, he said. Shell is going to put the entire workforce through a training program, geared to the expectations for the company’s Alaska operations.

“That’s to promote information sharing and learning across cultural and regional bounds, so that everybody learns together, (so) we’ve got one team used to working with one another,” Macrander said.

An aerial marine mammal observation program in the Beaufort Sea will involve overflights of the Camden Bay area by an aircraft carrying five or six marine mammal observers, still cameras and video equipment, to monitor the impact of the drilling on migrating bowhead whales. A similar program for the Chukchi Sea will involve flying an offshore saw-tooth pattern close to the Chukchi Sea coast. However, weather permitting, the preferred Chukchi Sea flight pattern will be out to the Burger prospect, with the caveat that, in the interests of safety, these flights will carry only video and still camera equipment, with no marine mammal observers on board.

“This is our proof of concept that we hope will lead potentially as early as 2013 to using unmanned aerial systems, to be able to collect these data for us,” Macrander said, commenting that unmanned “drones” would be safer and quieter than manned aircraft.

Rather than depending on currently available weather and ice forecasts Shell will acquire and process its own satellite data for its own weather and ice forecasting, Macrander said.

“Current weather forecasting and ice forecasting doesn’t give the kind of resolution that we feel like we need,” he said.

All of the vessels and rigs involved in the drilling operations are fully ocean capable, and could stand by offshore were a severe storm to interrupt the drilling, he said.

Science program

For several years Shell, in collaboration with other companies, government agencies and universities, has been conducting an environmental science program in the Chukchi and Beaufort seas, collecting baseline environmental data. Data gathering arrangements include the deployment of arrays of subsea sound recorders to monitor the presence and movements of marine mammals, as well as detailed multiyear environmental research in Shell, ConocoPhillips and Statoil Chukchi Sea drilling prospect areas.

The monitoring program meets the monitoring requirements and information needs for environmental permitting, Macrander said. The resulting set of baseline data also helps in planning offshore projects and will help in the design of future offshore oil and gas facilities, he said. The program also provides a venue for the development of new monitoring technologies such as unmanned aerial systems.

“Ecological characterization is important for a number of reasons,” Macrander said. “It’s important in order for us to demonstrate both to ourselves and to external stakeholders that we understand this (physical and biological) system that we’re trying to operate in.”

About 60 percent of Shell’s Alaska science research funding is leveraged through collaboration with other entities in the science program, Macrander said. Shell has also signed an agreement with the North Slope Borough for a joint science program. And Shell, ConocoPhillips and Statoil have signed an agreement with the National Oceanic and Atmospheric Administration to make all of their Alaska Arctic science data publicly available.

“We’re hopeful that this huge volume of data that will be made available will advance the understanding of the Arctic as a whole,” Macrander said.

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