On Jan. 30, Shell Oil announced that it has postponed plans to drill for oil in the Chukchi Sea off the northwest coast of Alaska in 2014. Shell’s decision followed a recent court decision that threw into question the status of Shell’s offshore oil leases in the Chukchi Sea—but other factors are at play, too.
As explained in my previous blog post, a panel of the 9th U.S. Circuit Court of Appeals recently ruled that an environmental analysis associated with the 2008 Chukchi Sea lease sale was faulty. Under the court’s decision, the Bureau of Ocean Energy Management will have to revisit that environmental analysis, and then decide whether to affirm its 2008 decision to sell the offshore leases. In the wake of the court ruling, Shell’s new CEO announced that the company is “not prepared to commit further resources for drilling in Alaska in 2014.”
On Jan. 22, a panel of the 9th U.S. Circuit Court of Appeals issued an opinion that will help ensure federal agencies and the public have a more complete picture of the risks and environmental impacts that could result from the sale of offshore oil and gas leases. The court’s decision also raises serious questions about the status of Arctic leases in the Chukchi Sea off the northwest coast of Alaska, and could make it difficult for companies like Shell Oil to drill for oil anytime soon.
The 9th Circuit ruled that the Bureau of Ocean Energy Management (BOEM) did not follow legal requirements when the agency assessed the potential environmental impacts of a 2008 offshore oil and gas lease sale in the Chukchi Sea. Before deciding whether to sell offshore oil and gas leases, BOEM conducts an environmental analysis. Part of that analysis assesses the potential impact of oil and gas development that might result from the lease sale. In the case of the Chukchi Sea lease sale, BOEM’s analysis assumed the sale of the offshore leases would result in the production of a relatively low volume of oil. In fact, BOEM used the very lowest estimate that could possibly be expected.
Yesterday in Anchorage, the U.S. District Court of Alaska upheld the Bureau of Safety and Environmental Enforcement’s decision to approve Shell Oil’s plans for preventing and cleaning up an oil spill in the Arctic Ocean. The court’s decision is a setback, but it doesn’t change the fact that Shell has failed to meet its obligation to operate safely and responsibly in the Arctic at every turn.
The 2012 Arctic drilling season for Shell was remarkably calamitous. From the beginning, Shell experienced failures when their drillship the Noble Discoverernearly ran aground in Unalaska Bay near Dutch Harbor, Alaska. By the end of the drilling season, the same drillship developed propulsion problems and needed to be towed into port in Seward for repairs.
Then in late December, the Kulluk, Shell’s other Arctic drilling unit, ran aground off of Sitkalidak Island after heavy seas snapped the towline between it and Shell’s tugboat. After a salvage operation plucked the Kulluk off the coast—thankfully with no major injuries or spills—it was eventually dry-towed to Asia for repairs in March.
Today, Alaska Senator Mark Begich introduced important new legislation that would establish a permanent program to conduct research, monitoring, and observing activities in the Arctic. If passed, Senator Begich’s bill could lead to significant advances in Arctic science that can then be used to support decisions about the management of a region that is crucial not only to the people who live there, but to the world.
For years, Shell has tried to carry out a risky plan to drill for oil in the Arctic Ocean. This summer, it looked like Shell would finally get its wish.
In June, Secretary of the Interior Ken Salazar said that it was “highly likely” that the federal government would issue the permits Shell needs to conduct Arctic drilling operations. Later, Secretary Salazar told the New York Times that he would decide no later than August 15 whether to allow Shell to conduct exploration drilling in the Arctic this summer.
August 15 came and went, and there was no decision from Secretary Salazar. Why the delay? The delay comes because, as Ocean Conservancy and others have stated repeatedly, Shell is not ready to drill.
Despite having years to prepare, Shell has been unable to complete a series of required modifications to its oil spill containment barge. The barge, the Arctic Challenger,is an integral part of Shell’s oil spill response plan for the Arctic Ocean. But the vessel is currently undergoing modifications in Bellingham, Washington—far from the Arctic.
Less than two weeks ago, I wrote about the Obama administration’s decisions on Arctic oil and gas lease sales in the new five year offshore drilling program. That day, there was both promising and discouraging news. Today, however, the news is not mixed: Ocean Conservancy – in conjunction with a coalition of like-minded groups – is filing suit in federal court challenging the Bureau of Safety and Environmental Enforcement’s (BSEE) approval of Shell Oil’s spill response plan for the Chukchi Sea. Instead of approving plans that authorize risky exploration drilling, the Obama administration should focus on developing and implementing a comprehensive science and monitoring plan so that we can make more informed decisions about whether, when, where, and how to allow drilling in the Arctic.
Shell is proposing major industrial activity in a remote and dangerous place. The Arctic Ocean is prone to hurricane-force storms, 20-foot swells, sea ice up to 25 feet thick, sub-zero temperatures, and months-long darkness. There is no proven way to clean up an oil spill in these extreme conditions. And on top of all that, the Arctic has extremely limited infrastructure: There are no roads or deep water ports and only a handful of small airports. The nearest Coast Guard station is over 1,000 miles away.
This decision is disappointing — especially considering that it was just a year ago that the U.S. Geological Survey released a report outlining significant gaps in science that must be addressed to make no-regrets choices about oil and gas development in the Arctic. Many of those gaps have yet to be filled.
How can federal agencies make informed decisions about future lease sales or exploration drilling without a better understanding of the Arctic ecosystem?