Salazar Concerned About Shell’s Arctic ‘Mishaps’
Interior was skeptical about Shell Oil’s offshore oil drilling in the Arctic, but Secretary Ken Salazar said he would withhold judgment about the company’s recent accidents until a high-level review is completed.
“There is a troubling sense I have that so many things went wrong,” Salazar said, “And that’s what [Bureau of Ocean Energy Management Director] Tommy Beaudreau will dig into, and I’m looking forward to the results of that review.”
Though the department granted Shell permits for limited preparatory activities in the Arctic, Salazar told the Ocean Energy Safety Advisory Committee on Wednesday that the Interior Department rebuffed Shell’s requests to drill for oil last year as the company suffered “multiple mishaps” in the region.
“Because we were holding the line and we wanted to make sure we were protective of the environment, we never felt comfortable allowing Shell to move forward with drilling into hydrocarbon-bearing zones in the Arctic,” Salazar said.
On Tuesday, Interior announced plans to conduct a review of Shell’s activities in light of the New Year’s Eve grounding of the Kulluk drilling rig. Salazar said the administration had not changed its policy position on exploring in the Arctic and that stepping back from opening the region to oil companies would not be appropriate.
“We need to know what resources are available and you cannot do that without actually knowing what the geophysical properties are with the kind of exploration that’s being done,” Salazar said.
Shell was able to develop “significant science” during its work last year, and more needs to be developed so “decision makers can make appropriate decisions with respect to the future,” Salazar said.
Interior watched Shell’s activities in the Arctic closely, Salazar said, including putting monitors on its ships and rejecting the company’s request to drill into oil reservoirs.
“I think we did what we had to do,” he told reporters after his comments. “I also think it’s important at this point in time to see what happened with this sequence of mishaps — was there some systemic issue with the way Shell dealt with it or was there some other explanation with contracting issues between Shell and its contractors. But it’s troubling there was such a series of mishaps as this effort was unfolding.”
Shell’s spill containment system was damaged during a test last year, but it was able to complete the preparatory work, such as creating a mudline cellar for the blowout preventer. And approval of the Arctic Challenger, Shell’s oil spill response barge, was repeatedly delayed because the company hadn’t completed work on the vessel.
The Kulluk ran aground on an island off the coast of Alaska on Dec. 31 and was towed to a safe harbor in Kiliuda Bay on Monday. Shell’s ability to do any work in 2013 may be in jeopardy even before the Interior review is complete.
Under the current permit requirements, the company must have two rigs on-site so that one can drill a relief well in the event of a spill. With the Kulluk potentially sidelined with damages, it’s unclear whether it will be available in time for drilling season. Unified Command for the Kulluk incident said that remote-operated vehicles assessed the hull of the rig on Tuesday.
“I expect sometime over the next three to four months, or before that, [Shell] will make a determination on whether they have the capacities to meet the permit requirements,” Salazar said. “If they don’t meet the permit requirements, we won’t let them go forward.”
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