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Breaking: Shell Oil Announces It Will Not Drill In The Arctic Ocean In 2013

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"Breaking: Shell Oil Announces It Will Not Drill In The Arctic Ocean In 2013"

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By Kiley Kroh

After a year full of mishaps and failures in its quest to drill for oil off the coast of Alaska, Royal Dutch Shell announced today that it would not pursue exploratory drilling activity in the Arctic Ocean this year.  The decision comes as the Obama administration nears the end of its high-level, 60-day review of Shell’s troubled Arctic drilling program, which was announced on January 8.

Last year was fraught with problems for Shell as the company attempted the first Arctic offshore exploratory drilling activity in decades. Technical failures, permit violations, struggles with the harsh and unpredictable Arctic conditions, and warnings from a wide range of voices all combined to discredit the company’s claims that such operations could be carried out safely and responsibly.

Shell made clear it sees this announcement as a hiatus, not a cancellation of its plans to tap the Arctic reserves. Marvin Odum, Shell’s Director of Upstream Americas said, “Our decision to pause in 2013 will give us time to ensure the readiness of all our equipment and people following the drilling season in 2012.”

Following mishaps this year, both of the company’s Arctic drilling rigs, the Kulluk and Noble Discoverer, require substantial repairs and will be towed to Asia.  The Kulluk was damaged when it was grounded near Kodiak, Alaska on New Year’s Eve and the Noble Discoverer was recently cited for multiple safety and environmental violations – now the subject of an investigation that was handed over to the Department of Justice this week.

As articulated in the recent op-ed co-authored by John Podesta and Carol Browner, the Center for American Progress was open to the possibility of offshore drilling in this remote region provided the Administration took significant steps to strengthen safeguards and improve response capacity, and the industry could demonstrate it was prepared for the extreme risk. Instead, Shell proved precisely the opposite – the oil and gas industry is not prepared for the enormous challenge of drilling in the Arctic Ocean.

As we’ve detailed numerous times, there is a tremendous and incalculable risk associated with any offshore operations in the Arctic. First, the region lacks even the basic infrastructure that would be necessary to mount a large-scale response to an oil spill or other major incident – roads, major airports, ports, a permanent Coast Guard facility, adequate facilities to house and feed responders. These obstacles, coupled with the extreme and volatile conditions in which companies would be operating, led the insurance giant Lloyd’s of London to warn companies that responding to an oil spill in a region “highly sensitive to damage” would present “multiple obstacles, which together constitute a unique and hard-to-manage risk.” And Total SA, the fifth largest oil and gas company in the world, announced it wouldn’t seek to drill in the Arctic because an accident there would be a “disaster.”

Rushing into Arctic offshore drilling is not an imperative and thus should not be attempted unless and until independent auditors determine the industry and the government are capable of acting responsibly and responding to a true worst-case scenario. No operation is foolproof, but when even the most carefully watched drilling operations repeatedly fail to attain safety certification, then are hit with routine air pollution violations, and marred by twice letting major pieces of equipment be cast adrift, the American people have no reason to continue taking oil companies at their word when they tell us they can operate safely and responsibly in this remote and dangerous region.

Update

The Center for American Progress released the following statement yesterday from its chair John Podesta, responding to Royal Dutch Shell’s decision to suspend its drilling operations in the Arctic:

Today’s announcement is a reminder that the industry does not yet have the adequate technology to operate safely in this remote and harsh environment. One company hitting the pause button will not mitigate the risks involved, the Department of the Interior should hit the stop button to prevent any oil and gas drilling from taking place in the Arctic Ocean.

Related Resources:

– Kiley Kroh is the Associate Director for Ocean Communications at the Center for American Progress

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20 Responses to Breaking: Shell Oil Announces It Will Not Drill In The Arctic Ocean In 2013

  1. Don’t worry — Shell be back!

    Tax Carbon!

  2. Leif says:

    Indeed, tax the ability of the Fossil Barons to profit from the pollution of the commons and the madness will stop. Corporations are people now. I get fined if I throw a paper cup out the car window. I don’t. Corpro/People make billions tossing 19 pounds of toxins out the exhaust of commerce and threaten the very future of civilization. Go figure.

  3. Mike Roddy says:

    Kiley, you say Arctic drilling is OK with you and CAP as long as it’s well regulated. Then, you go on to say that the process is inherently dangerous.

    Why can’t you and CAP just say no to the whole nutty notion of drilling in the Arctic? This should not be a hard decision.

    • Brooks Bridges says:

      Yes!

      • Merrelyn Emery says:

        Too right Mike and Brooks. And the fact that people are still equivocating at this moment in our history can only ensure more such hubristic and insane ventures, ME

      • Merrelyn Emery says:

        Too right Mike and Brooks. And the fact that people are still equivocating at this moment in our history can only ensure more such hubristic and insane ventures, ME

    • John McCormick says:

      Kiley, the only reason this thread could come into reality is that global warming has changed the earth’s temperature balance by eliminating the albedo of the Arctic Ocean.

      If you understood the consequences of that massive step change in the earth’s process of transferring heat and cold around the northern hemisphere you and CAP would have condemned any effort to drill in the Arctic and fight like hell to prevent it.

      You, like most, do not get it. And, through our limited capability to accept the consequences and do all possible to prevent them, we are on the path to extinction.

    • Michael Conathan says:

      Perhaps we weren’t clear enough in the post, but Kiley does say CAP now opposes any effort to drill in the Arctic. The post states, “Center for American Progress WAS open to the possibility of offshore drilling in this remote region… Instead, Shell proved precisely the opposite – the oil and gas industry is not prepared for the enormous challenge…”

      The op-ed by John Podesta and Carol Browner (linked in this paragraph) states in no uncertain terms that following Shell’s disastrous season, CAP now opposes any offshore drilling in the Arctic Ocean.

  4. Paul Klinkman says:

    It sounds more like Shell admitting that its rig was too badly damaged to be on the water by the start of the drilling season.

  5. prokaryotes says:

    Government nearly caused a disaster in Alaska.
    Now, only individuals can repair the damage.
    Last week, Alaska’s eccentric tax environment forced us to temporarily defloat our 28,000 ton rig near the island of Kodiak, endangering our plan to develop the Arctic’s rich oil belt in 2013. It’s not the first time onerous regulations have given us trouble– and surely it won’t be the last! –but with your help, we can get the “Classic” Kulluk repaired and ready to once again conquer the frozen North.

    Some regulators and environmentalists are letting emotions stand in the way of America’s energy destiny, but we refuse to be victimized. By donating to Shell’s #RepairingFreedom campaign, individuals who truly believe in our Arctic mission can help bring the Kulluk back to her former glory.

    The future can’t wait.

    For as much as it costs to chlorinate your pool, you can help us achieve our ambition of leveraging Arctic ice melt for extraordinary shareholder benefit.

    Alongside our partners at Smit salvage, we’ve created an innovative sponsorship program which allows you to inscribe your family’s name on one of America’s most important energy projects. We’re calling it the Shell Legacy Seal®, and we believe it’s a first for our industry. Each #RepairingFreedom hero will become a named “sponsor” of improvements to the damaged Kulluk, and see his family name thoughtfully etched onto upgrade stock like specialized 2’’ Hex bolts, emergency generator shielding and state-of-the-art liferaft technology.

    Use the custom tweets below to show the world which part of the new and improved Kulluk you’d like to sponsor to help our classic rig make energy history in 2013.

    I believe in #RepairingFreedom so I’m sponsoring a bespoke 2’’ Hex
    bolt for @shell’s new & improved #Kulluk

    I believe in #RepairingFreedom so I’m sponsoring a custom vinyl
    reinforced liferaft for @shell’s new & improved #Kulluk

    I believe in #RepairingFreedom so I’m sponsoring emergency generator
    shielding for @shell’s new & improved #Kulluk

    I believe in #RepairingFreedom so I’m sponsoring an expandable tow
    connection for @shell’s new & improved #Kulluk

    I believe in #RepairingFreedom so I’m sponsoring infrared petroleum
    detection for @shell’s new & improved #Kulluk
    http://arcticready.com/

    • Brooks Bridges says:

      Wonderful! Badly needed a laugh. Are you writing for the Onion now?

      • prokaryotes says:

        Yes, humor is maybe the best weapon against the nutty idea to drill the Arctic to burn more oil. I did not wrote this, just found it by searching a similar text i read at the time of last years Kulluk accident.

    • Sasparilla says:

      That was hilarious prokaryotes…love the reference to chlorinating the pool…great.

  6. prokaryotes says:

    PALM intended the action to help shine a spotlight on the case, brought by the widow of Dr. Barinem Kiobel, who was hanged along with novelist Ken Saro-Wiwa for opposition to Shell’s drilling plans in West Africa. Shell is alleged to have aided paramilitary forces that raided more than 60 villages, killed over 800 people, and displaced 30,000 more.

    To prevail, Shell lawyers must overturn a 200-year-old law, the Alien Tort Statute (ATS), that compensates victims of international crimes. (The law has been used to compensate Holocaust survivors who sued for restitution from corporations that profited from slavery and forced labor during World War II.) Shell’s lawyers are arguing that their corporation is not subject to the ATS because it is not a person.

    “When it comes to things like election spending, Shell and other corporations want to have all the rights of people,” said Sean Dagohoy from PALM. “But when accused of murder, Shell conveniently argues that they aren’t a person. http://www.salon.com/2012/10/02/aided_by_yes_men_activists_strike_at_shell/

    • Mulga Mumblebrain says:

      So they, and their ‘lawyers’, have added cynical duplicity to their catalogue of sins. They must have a full set by now, so they’ll just have to invent a few more.

  7. Tom says:

    Why do bloggers use the term “breaking”?
    Typically people read it AFTER already hearing or reading elsewhere – thus it is NOT breaking.

    It seems like a desperate cry for attention. For most blogs I consider it a sign they are not serious. I obviously make an exception for thinkprogress.

    But please consider dropping the practice. It is at best annoying.

  8. Sasparilla says:

    Looks like the Keystone cops who seemed to run Shell’s arctic operation this past year won’t be able to fix everything to have another go at it in 2013, thank goodness (they’ll be ready for 2014 though).

  9. nealjking says:

    They’re only doing it to take the pressure off. Hoping for reconsideration in a less difficult environment.