Shell’s Attempt To Get Drilling Equipment Out Of Arctic Before Winter Underscores Challenges In The Region

First published on ClimateProgress.org, a project of the Center for American Progress Action Fund, which was recently named one of Time magazine’s Top 25 blogs of 2010.

by Kiley Kroh

A season full of setbacks in Shell’s quest to drill for oil in the Arctic Ocean isn’t over yet.  More than a week after preparatory drilling operations ended for the season, the company is struggling to get all of its equipment out of the Beaufort Sea as winter ice encroaches.  As Popular Mechanics reports, as of Tuesday night, the company’s Kulluk rig was still moored in the Beaufort Sea where temperatures have dropped below zero.

While the conditions don’t pose any immediate danger, they underscore the immense challenge of operating in the severe and unpredictable Arctic.  Due to the extremely harsh winter conditions and lack of a major port facility in the region, Shell’s rigs and support vessels must begin the 1,000-mile journey back to Dutch Harbor before the route becomes too ice-choked to traverse.  As the Popular Mechanics reporter on board the rig describes, just unmooring the Kulluk has proven to be a logistical nightmare:

First, there were 83 men on board, a number that was supposed to go down to just 17 for the trip south. By Alaska standards, the weather remained stable, yet flights between the rig and the company’s facilities on land at Prudhoe Bay were delayed for days at a time. Shell had contracted with PHI, Inc., a helicopter services company that is ubiquitous in the Gulf of Mexico. But the company’s Sikorsky S-92 helicopters had not been prepared with de-icing equipment, and the pilots I spoke with lacked experience flying on the North Slope.

A second issue concerned the Aiviq tug’s fuel reserves. Shell had committed to laying a containment boom out on the ocean surface during vessel-to-vessel refueling, but the seas had been too rough to do that. The tug needed to refuel before starting to haul the Kulluk.

Finally, the Kulluk was required to offload its wastewater to another vessel for eventual disposal on land, but those operations also proved vulnerable to disruption by rough seas.

The latest challenges add to a long list of hurdles Shell has faced in a drilling season plagued with technical failures, struggles with Mother Nature, and an array of voices expressing serious concern about our lack of preparedness to operate in the region. Here’s a quick review:

• In February, an independent report issued by the Government Accountability Office identified a slew of environmental, logistical, and technical challenges associated with Arctic offshore drilling and concluded Shell’s “dedicated capabilities do not completely mitigate some of the environmental and logistical risks associated with the remoteness and environment of the region.”
• In April, insurance giant Lloyd’s of London issued a report on Arctic offshore drilling, warning that responding to an oil spill in a region that is “highly sensitive to damage” would present “multiple obstacles, which together constitute a unique and hard-to-manage risk.”
• German bank WestLB announced it would not provide financing to any offshore oil or gas drilling in the Arctic, saying the “risks and costs are simply too high.”
• In July, Shell briefly lost control of its Noble Discoverer rig, which came dangerously close to running aground in Dutch Harbor.
• In September, a British parliamentary committee called for a halt to drilling in the Arctic Ocean until necessary steps are taken to protect the region from the potentially catastrophic consequences of an oil spill.
• Total SA, the fourth largest publicly traded oil and gas company in the world, became the first major oil producer to admit that offshore drilling in Arctic waters is a risky idea, saying such operations could be a “disaster” and warning other companies against drilling in the region.
• After repeatedly failing to receive Coast Guard approval for its containment barge, a critical piece of oil spill response equipment, Shell was forced to postpone exploratory drilling operations until 2013 and settle instead for only drilling two preparatory wells.
• Then just one day after beginning its long-awaited preparatory drilling operations, Shell suspended drilling due to a massive ice pack covering approximately 360 square miles drifting toward the site.

Despite the harsh realities the company faced this season, Shell has spent six years and nearly $5 billion on Arctic offshore drilling and won’t be giving up anytime soon.  Shell Alaska spokesman Curtis Smith told the Washington Post the company considers this season a success and is “looking forward to revisiting these wells as soon as we can next year.”

It is critical to note, however, that the glaring deficiencies in infrastructure and scientific knowledge that could severely impede our ability to respond to an oil spill in the area won’t be addressed for quite some time – and certainly not by next year.

Watch a short documentary on the situation:

As climate change alters the Arctic more rapidly and acutely than any other part of the world, a cautious approach to industrialization in this fragile and largely unexplored ecosystem becomes even more essential.  With other domestic oil production on track to hit its highest level since 1993, rushing into Arctic offshore drilling is not imperative and, as Shell’s recent mishaps and setbacks have plainly illustrated, it remains an endeavor full of risk.  Until adequate investment in research and infrastructure is coupled with industry’s proof that they are able to meet the extremely high standards necessary to operate in such an environment, the Arctic Ocean should remain off-limits to drilling.

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