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Vol. 18, No. 7 Week of February 17, 2013
Providing coverage of Alaska and northern Canada's oil and gas industry

Shell to move rigs

Will dry tow Kulluk and Noble Discoverer to Asian shipyards for repair

Alan Bailey

Petroleum News

Following weeks of speculation over the eventual fate of the Kulluk, Shell’s floating drilling platform that ran aground en route from the Aleutians to the U.S. West Coast, and with the drillship Noble Discoverer stuck in the Alaska port of Seward with propulsion problems, Shell has shed some light on how it proposes dealing with its two Arctic drilling units. The two vessels had been transiting south, following the end of the 2012 drilling season in the Beaufort and Chukchi seas.

Move to Asia

Shell is going to move the Kulluk to an Asian harbor with a suitable dry dock for repair, company spokesman Curtis Smith said in a Feb. 11 email. The Kulluk has been anchored in Kiliuda Bay on the south side of Kodiak Island since Jan. 7, having been refloated after running aground in a severe storm on the evening of Dec. 31. The vessel had been scheduled for winter maintenance work at a West Coast shipyard.

Shell is also moving the drillship Noble Discover to Asia, to a shipyard in Korea, for repair, Smith said. Like the Kulluk, the Discoverer had been en route for the West Coast for maintenance. The drillship made the trip as far as Seward before being beset with the propulsion problems. And while the vessel was in Seward a U.S. Coast Guard inspection spotted deficiencies in some crew safety and pollution prevention systems.

Shell owns the Kulluk but contracts the Noble Discoverer from Noble Corp., the drillship’s owner and operator.

Dry tow

Smith said that the Kulluk will be first towed to Dutch Harbor. Both the Kulluk and the Noble Discoverer will be transported to Asia using what is called a “dry tow,” a procedure in which the vessel being transported sits on the deck of a large heavy-lift vessel.

The time required for the shipyard work and the return to service of the rigs will depend on further inspections of both rigs, Smith said.

Shell will presumably need two operational drilling vessels to continue its Arctic exploration drilling program in the summer of 2013. In addition to wanting to drill simultaneously both in the Chukchi and Beaufort seas, each drilling operation will need a second rig to be available for relief well drilling, in the unlikely event of a well blow out that incapacitates the rig drilling the problem well.

“We have not made any final decision on 2013 drilling in Alaska,” Smith said. “Mapping the next steps for the Kulluk and the Noble Discoverer is a multifaceted operation and today’s update is a result of those new plans being solidified.”

Standing down

A Feb. 13 press release from the Joint Information Center for the Kulluk grounding incident said that the unified command for the incident is standing down.

“Agency representatives will return to their normal roles and responsibilities,” said Capt. Paul Mehler III, the U.S. Coast Guard federal on-scene coordinator. “The Coast Guard will continue to monitor the activities involved in prepping the Kulluk for movement and I will lift the captain of the port order (detaining the Kulluk) once all the requirements have been met.”

“Our objectives for the duration of this response have been to ensure the safety of all responders involved, protect the environment, and prepare the Kulluk for its next port. Thanks to the hard work and professionalism of all those involved in this extraordinary effort, we have achieved these goals,” said Sean Churchfield, Shell incident commander. “I want to thank all of the individuals involved in the recovery effort for their dedication to ensuring a successful outcome.”

Ready for tow

Det Norske Veritas, the engineering firm commissioned to assess the condition of the Kulluk, has validated that the vessel has the necessary structural integrity and stability to be towed, and has issued appropriate certification for the vessel. However, an independent warranty surveyor will need to approve the towing arrangements, as well as witness the connection of tugs. Three tugs, accompanied by the Nanuq, Shell’s Arctic oil spill response vessel, will tow the Kulluk to Dutch Harbor, a transit that should take about 10 days, the press release said. The departure date will depend on a favorable weather window.

Smith has told Petroleum News that it would likely take two to four week weeks to transport the Kulluk and the Noble Discoverer to Asia, once suitable dry-tow vessels have been transitioned to Alaska for the tows.

Damaged

According to the Joint Information Center press release, the damage assessment of the Kulluk at Kiliuda Bay showed that the Kulluk’s inner hull had not been breached during the grounding but that the outer hull had suffered damage that could be anticipated from a grounding in adverse weather. The Kulluk has sustained water damage to its superstructure and some technical equipment; seawater breached some windows and hatches; but the vessel’s fuel tanks remain intact.

In preparation for the tow, crews at Kiliuda Bay have secured all windows and hatches, and where necessary have installed temporary steel structures to ensure that the vessel is weather tight, the press release said.

Shell has contracted the Native corporation for Old Harbor, the village close to the grounding site on Sitkalidak Island, to oversee teams that will clear lifeboat debris from the Kulluk from the shore where the vessel ran aground. The recovery of the debris will take some time because of the challenging terrain and the need for safety, the press release said.

More than 750 people have worked on the response to the incident. Shell has estimated the cost of the response to the Kulluk grounding and the salvage of the vessel to be around $90 million.

Questions raised

The Kulluk grounding did not happen in the Arctic and did not occur as part of a drilling operation. However, environmental organizations, vehemently opposed to Arctic offshore oil exploration, have made much of Shell’s problems, saying that a string of incidents culminating in the Kulluk grounding illustrate the risks associated with seeking oil in Arctic waters and raise questions over Shell’s ability to operate safely in the challenging Arctic marine environment.

“These serious transportation, logistics, and drilling failures — collectively — provide strong evidence of Shell’s inability to effectively undertake oil drilling in the harsh environment of the Arctic Ocean, and raise questions about any company’s capacity to do so,” said Lois Epstein, Arctic program director of the Wilderness Society.

The U.S. Coast Guard is conducting a formal investigation of the Kulluk grounding. And, as a result of the grounding, in January the U.S. Department of the Interior announced a 60-day, high-level assessment of Shell’s operations in the Arctic in 2012, examining Shell’s safety systems, the company’s oversight of its contracted services and the company’s ability to meet the strict standards in place for Arctic development.



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