Climate

Court Throws Out Challenge To Shell’s Arctic Drilling Plans

CREDIT: Shutterstock

One of many legal challenges to Royal Dutch Shell’s plans to drill for oil in the Arctic Ocean this summer was thrown out by a federal appeals court on Thursday, after judges refused to accept arguments that the company was not prepared for a big oil spill in such a harsh, remote climate.

To environmental groups’ disappointment, a three judge panel for the 9th U.S. Circuit Court of Appeals ruled 2-1 that the federal Bureau of Safety and Environmental Enforcement (BSEE) acted lawfully when it approved Shell’s oil spill response plans for its leases in the Beaufort and Chukchi seas. Ten groups — which included the National Resources Defense Council, Greenpeace, and The Audubon Society — had argued in the lawsuit that BSEE’s approval of the response plans was “arbitrary” and “capricious,” because Shell would not realistically be able to clean up a large amount of oil if it spilled into the Arctic Ocean.

The panel majority did not, however, say Shell’s oil spill response plan was sound, nor did it say that Shell would be able to clean up a big spill. Instead, Circuit Judges Jacqueline Nguyen and Jerome Farris said BSEE just didn’t have the ability to reject Shell’s plans, because they were in line with the federal Oil Pollution Act. That act, the judges said, did not specifically require Shell to prove whether it could clean up the an entire oil spill to have its oil spill response plan approved.

The environmental groups also had two more arguments: that the oil spill response plan failed to consider endangered species, and that there was no environmental impact statement performed before BSEE approved the plan. Again, the two-judge majority rejected both of those arguments, saying BSEE was not required to prepare an environmental impact statement, nor was it required to consult with environmental agencies under the Endangered Species Act.

Senior Circuit Judge Dorothy Wright Nelson, however, disagreed. She argued that BSEE should have done both an Endangered Species Act consultation and an environmental impact statement before approving the plan, noting that the Oil Pollution Act specifically requires BSEE to consider environmental factors in its decision making process.

“The Oil Pollution Act and its implementing regulations grant the Bureau significant authority to regulate the activities of owners and operators of offshore facilities,” Nelson wrote. “The regulations demand that the plan include provisions for protecting wildlife and areas of special environmental importance.”

Environmentalists have long been worried about Shell’s ability to clean up an oil spill if one occurs in the Arctic Ocean, a sensitive ecological environment where weather is harsh and unpredictable. And they contend that a spill will happen, citing a Bureau of Ocean Energy Management (BOEM) analysis that showed a 75 percent chance of a spill greater than 1,000 barrels should an oil company like Shell discover and fully produce oil in the Chukchi Sea leases.

Shell also already had an accident in the Arctic the first time it tried to drill there; in 2012, while the company was towing its Kulluk oil rig out into Dutch Harbor via ship, a harsh winter storm hit and the ship lost control of the rig. The rig, along with 150,000 gallons of fuel and drilling fluid, washed up on an island along one of Alaska’s pristine coastlines.

Now, the only way this lawsuit over Shell’s spill response plan can move forward is if it goes to the U.S. Supreme Court, and it’s unclear whether the environmental groups will try to appeal. However, environmental groups are trying to halt the company’s plans in other ways — a lawsuit filed earlier this month against BOEM accuses the agency of performing a “rush and cursory” review of Shell’s plans, and seeks to nullify it. Protestors have also delayed the company’s plans a number of ways, first boarding its rig and refusing to leave, then surrounding it in a barricade of kayaks.

As for Shell, a company representative told Reuters that it was happy to be done with at least the one lawsuit for now.

“We look forward to receiving the remaining permits necessary to commence exploration activities offshore Alaska in the weeks to come,” the representative said.