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Oil & Minerals
Drilling Alaska

Shall Shell overcome?

Shell has made it over logistical, regulatory and public-relations hurdles in its plans to drill for Arctic oil this year. Legal challenges could prevent it from becoming an annual event
Oil & Minerals
Remember the ‘Kulluk’

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On Monday, Shell, an Anglo-Dutch oil giant, received final approval from US federal authorities to drill into potentially oil-bearing rock off the Alaskan coast. The approval is the final regulatory hurdle Shell needed to clear before drilling in the Burger Prospect, an oil field in Chukchi Sea, some 515km north of the Arctic Circle.

Shell’s return to the Arctic began on May 11, when the White House conditionally approved the firm’s plan to drill two exploration wells. (Yesterday’s approval was for the first of these.) A laundry list of requirements, described by the Bureau of Safety and Environmental Enforcement, a regulator, as “extensive” and “robust”, are aimed at ensuring the drilling meets “the highest safety, environmental protection and emergency response standards”.

One of those requirements stipulated that equipment capable of capping a well in the event of a blow-out that leads to an uncontrolled release of oil be on hand at all times. That equipment is placed on the MV Fennica, a Finnish ice-breaking vessel. The Fennica’s arrival was delayed (and thus Shell’s drilling window shortened) when it struck an object in the waters off Dutch Harbor, Alaska, on July 3.

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After repairs to the metre-long gash in the ship’s hull were completed by a Portland, Oregon, shipyard, protesters sought to prevent the vessel from leaving port. Their demonstration – dangling on ropes from a bridge over Willamette River – was unsuccessful, but it ensured that the public’s attention remained on the drilling and its potential consequences.

With this latest permit in hand Shell will be able to drill until late September, but with the drilling season in Alaska’s Arctic waters limited to three months, getting the oil to market, if any is found, will take much longer, perhaps 15 years, according to Bloomberg Business, an American news website.

Opponents, however, are working to use the courts to make sure that this year is the last.

Two lawsuits are currently underway to force Shell to stop. In the first, a group of plaintiffs are challenging the Department of Interior in a federal appeals court, to decide whether Shell’s exploration plan violates the Continental Shelf Land and National Environmental Policy acts.

SEE RELATED: In technology we trust

Documents submitted to the courts on August 12 challenge the plan’s approval, arguing that it was based on Environmental Impact Statements (EIS) that “acknowledge hundreds of times that there is missing information about basic subjects like habitat use, seasonal migrations, and life characteristics for a wide variety of wildlife species in the Chukchi Sea”.

Without this information, argue the plaintiffs, it will be impossible to determine if drilling will cause significant environmental effects.

The second suit was filed with the district court of Alaska in June. This one takes issue with the overall validity of the EIS. Michael Burger of the Columbia Law School says that the EIS has been sent back to the regulator twice before for various inadequacies and it may be sent back again if the court determines there are problems with the analysis of impacts on walrus.  

He also suggests the Alaska court may force Shell to disclose the effects of burning the oil it extracts which would break new ground for EIS requirements. “There is no law of the land on this issue, and we could see an important decision from the 9th Circuit Court of Appeals.”

This would build on a precedent set by a court decision in Colorado, in which a proposed coal-mine expansion was disallowed because the regulator failed to take into account the environmental impact of burning the additional coal.

“What’s at stake here,” Mr Burger says, “is whether the regulators are taking into full account the effects of projects taking place on public land.”

CORRECTION: This article was edited on Aug 20 in order to more accurately reflect Mr Burger’s statements to us. We apologise for the error.