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Preparing to drill in Arctic waters - Oct 23

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Many more articles are available through the Energy Bulletin homepage.


The Arctic and the Lessons of the Gulf

Editorial, New York Times
The Interior Department has been inching closer to approving Royal Dutch Shell’s ambitious plans to drill for what are believed to be huge deposits of oil in the Arctic Ocean off Alaska. In August, it approved an exploratory drilling plan for the Beaufort Sea, and two weeks ago it upheld the validity of leases in the neighboring Chukchi Sea that had been challenged by environmental groups.

The Interior Department and Shell both insist that they have learned the lessons of the disastrous BP spill in the Gulf of Mexico. They must prove it. The Interior Department has written tough new regulations governing drilling, including requirements for subsea containment systems to plug a runaway well.

Before issuing final permits to drill, the government must insist that Shell test such a system and verify that it can operate in Arctic conditions. The company must also have on hand a rig capable of drilling a relief well, as well as the equipment — skimmers, booms and other equipment — to clean up any oil that escapes.

The stakes here are undeniably huge. Shell has already paid nearly $4 billion to acquire leases in the Beaufort and Chukchi Seas. Estimates of the recoverable reserves range as high as 30 billion barrels of oil, the equivalent of more than four years’ worth of annual oil consumption in this country. The cost of a mistake would also be huge. Arctic waters provide nutrients for large fish populations, extensive habitat for wildlife and sustenance for native peoples.

The Arctic presents an extremely forbidding environment, with sea ice, howling winds and stormy conditions that will make drilling difficult and any cleanup far more complicated than it was in the warm and relatively benign waters of the gulf.
(29 October 2011)
Artctic articles suggested by EB contributor Bill Henderson.


Sen. Murkowski: U.S. Must be a Leader in Offshore Oil Production

Press Release
WASHINGTON, D.C. – U.S. Sen. Lisa Murkowski, R-Alaska, today stressed the importance of the United States being a leader in offshore energy production, as neighboring countries begin exploring for oil and natural gas along the U.S. maritime border.

“It does us no good to complain that offshore drilling is too risky for us to pursue when other nations are busy reaping the benefits right along our borders,” Murkowski said. “Neither geology nor ocean currents recognize borders, so we really have both shared opportunity, in terms of the benefits of resource development, and shared risk in terms of spills or other impacts that can occur.”

The United States shares maritime borders with Cuba, Russia, Canada and Mexico. All four countries are moving forward with plans to explore their own outer continental shelf regions. The Senate Energy and Natural Resources Committee held a hearing on Tuesday to examine the United States’ ability to respond to oil spills in foreign waters adjacent to America.

“We cannot expect international compliance with anything close to U.S. standards if we cannot first demonstrate that those standards work in a viable and profitable way here at home,” Murkowski said. “Our best defense against foreign spills is the responsible development of our own offshore resources, which not only means jobs, revenue and greater energy security for America, but also ensures that we retain the expertise and have the capabilities in place to respond to accidents.”

Among Tuesday’s witnesses was Mark Myers, former Director of the U.S. Geological Survey, who testified on the importance of Alaska’s expertise in oil development and to the vast resources contained in the Arctic, onshore and offshore. The Arctic holds an estimated 20 percent of the world’s remaining oil, with major undersea oil and gas deposits in the Beaufort and Chukchi seas, areas where the United States shares borders with Canada and Russia. Both have plans to drill in the region.
(18 October 2011)



Putin’s Russia will lead a ‘new era of Arctic industrialisation’

Tom Levitt, The Ecologist
The isolation of the white wilderness is coming to an end. Scientists and activists are urging caution but Russia is leading an urgent rush to exploit the Arctic’s oil and gas reserves. Tom Levitt reports

Autumn is the shortest of all seasons in the Russian city of Arkhangelsk. Lying on the edge of the Arctic circle, sub-zero temperatures arrive as early as September. By deep winter they can be -40C in the short-lived daylight hours.

Such a hostile climate has, until recently, deterred many from venturing further north, despite the promise of an abundance of oil, gas and minerals like nickel, copper and uranium.

But late last month, the sun was unusually warm in the city as Russia's power-maker and president-elect Vladmir Putin arrived at a conference on the Arctic to set out his ambitions for a new era of development in the region.

This will include offshore oil and gas exploration and drilling, new sea terminals, infrastructure and the promotion of a commercial shipping route through the increasingly ice-free Arctic Seas - nothing short of an industrialisation of the Arctic and its resources.

If there was any doubt about Russia's intentions to industrialise one of the world's last great wildernesses they were dispelled by Putin’s speech, in which he vowed to create a genuine rival to the Suez and Panama Canals for the lucrative shipping trade between Europe and Asia.

However, as everyone inside and outside the conference knew, the bigger immediate riches for both Putin and Russia's state-owned energy companies lie in the Arctic's untapped reserves of oil and gas.

The US Geological Survey estimates that 22 per cent of the world's 'undiscovered' oil and gas is to be found in the Arctic. What's more, a further 240 billion barrels of oil and oil equivalents (mostly gas) have already been found in the region. A figure almost as much as the entire proven hydrocarbon reserves of Saudi Arabia.

Many environmentalists want these reserves left alone, to protect the Arctic's fragile wilderness and prevent yet more greenhouse gas emissions.

For Putin and Russia that is unthinkable.
(19 October 2011)

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