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Shell scales back number of Arctic wells

Published: August 4, 2012 | 8:44 am
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LOS ANGELES—Shell has reduced the number of exploratory offshore Arctic wells it plans to drill this year as construction delays continue on a containment barge that must be finished first, the company said on Tuesday.
Weather is also a factor: Shell engineers had hoped to begin drilling in early August, before ice forms in the fall. Arctic drilling is controversial: The bitter cold could hinder cleanup of any spill.

The company had hoped to finish five exploratory wells this year, but now will attempt two: one in the Beaufort Sea northeast of Alaska, and one in the Chukchi Sea between Alaska and Siberia, officials said.

Its ultimate goal—10 offshore wells in Arctic waters by the end of 2013—remains unchanged, spokesman Kelly op de Weegh told the Los Angeles Times. If time allows, she said, Shell will begin drilling three more wells and cap the unfinished holes until next season. The exploratory drilling program would be the first in Arctic waters in two decades.

Reducing the number of wells is the latest in a series of delays linked to the Arctic Challenger, a 38-year-old barge in Bellingham, Washington, that is being retrofitted and renovated to act as an oil-spill containment system.

Getting the vessel certified by the Coast Guard is Shell’s biggest hurdle. Certification depends on safety and operational systems tests.

When the Arctic Challenger is ready, it will float between the Beaufort and Chukchi seas. If an oil spill couldn’t be otherwise contained, the barge would submerge a large dome to capture spilled oil, which it would bring to the surface and pump into a storage tanker for removal. It is also designed to flare off natural gas collected from malfunctioning wells.

The barge has already missed a preliminary deadline for sea trials by more than a week. Coast Guard officials have said that several important systems need to be installed before the oil-spill containment vessel is ready.

“The process has taken us a bit longer than we expected,” op de Weegh said.

Initially, the company had planned to classify the vessel as a stationary offshore platform, which would have required engineers to prove it could withstand a 100-year storm.

Later, Shell said that the barge should be classified as a mobile offshore drilling unit instead, since it could move out of a storm’s path. The Coast Guard agreed, meaning the barge must meet a lesser standard: a 10-year storm. Tests began on Tuesday.

The US Bureau of Safety and Environmental Enforcement has said it will not issue final drilling permits until the containment system is complete, certified and ready to deploy.

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