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WASHINGTON -- Based on safety concerns raised by last month's explosion of an oil drilling rig in the Gulf of Mexico, the Interior Department has given Shell Oil until May 18 to provide more information about the company's exploratory drilling plans this summer in the Arctic Ocean.
The department also said the Dutch oil giant will fall under the temporary halt to all pending U.S. offshore drilling proposals, putting the company's summer Arctic drilling plans in limbo. "The recent and ongoing tragedy of the Deepwater Horizon incident in the Gulf of Mexico highlights the importance of taking every step necessary to ensure the safety of all offshore drilling operations," Elizabeth Birnbaum, the director of the Minerals Management Service, wrote Thursday to Marvin Odum, the head of Shell's North American division. The letter wasn't unexpected, said the company's Alaska spokesman, Curtis Smith. The agency wants to know what sort of additional safety procedures Shell is proposing to undertake in light of the April 20 explosion, which left 11 dead and 210,000 gallons of oil leaking each day from the downed BP rig. "The company has been in the process of reviewing our Alaska drilling plan for several days now," Smith said in an e-mail. "If we do find new barriers and contingencies we can add to our existing plan, we will convey those details to the Department of Interior and then, depending on how they are received, potentially work to incorporate those additions." Interior Secretary Ken Salazar also announced late Thursday that Shell's offshore plans in the Arctic this summer will fall under the temporary halt to all new offshore drilling proposals pending in the United States. There will be no new offshore drilling until the Interior Department completes the safety review process requested by President Barack Obama, Salazar said. The department is required to deliver the report to the president by May 28. Salazar said specifically that the MMS will not make a final decision on Shell's permits for exploratory wells until the Interior Department's report to Obama has been submitted and evaluated. Right now, the company is moving forward with its plans to drill this summer, until someone says they can't. If the safety report requested by the president is delivered on time and "the Secretary's reaction to the information presented is favorable, the pause in issuing permits should not significantly impact our Alaska drilling plans," Smith said. "In terms of timeline, we obviously have short windows in which we have to work in Alaska," he said. "We are still working to mobilize our drilling plan." lobbying lawmakers Shell, hoping to put distance between the oil gushing from a BP rig into the Gulf of Mexico and its own pending Arctic project, sent a top executive and engineer to Capitol Hill this week to convince decision-makers that the company still be allowed to drill exploratory wells off Alaska's northern coast. The company's lobbying came as the Obama administration canceled planned offshore lease sales in Virginia and environmental groups went to court to delay Shell's plans to drill exploratory wells this summer in the Beaufort and Chukchi Seas. As they made the rounds on Capitol Hill, company officials emphasized the technical differences in drilling in 200 or less feet of water and the 5,000-foot-deep gulf operations. The company's oil response experts joined the vice president of the Alaska operation, Pete Slaiby, and one of their top engineers, Charlie Williams. The Shell team met with staffers who work on the Senate Energy and Natural Resources Committee for Sen. Lisa Murkowski, R-Alaska as well as Sen. Mark Begich, D-Alaska, and Rep. Don Young, R-Alaska. Shell in 2008 spent $2.1 billion on the Arctic leases in the Beaufort and Chukchi seas. The Minerals Management Service estimates that the two Arctic seas hold up to 19 billion barrels of oil and up to 74 trillion cubic feet of natural gas, making their resource potential comparable to the known oil and gas from the North Slope's onshore fields. In early April, the White House announced it supports development of some oil and gas leases in Arctic waters off Alaska's coast but won't allow drilling in federal waters near Bristol Bay. Following the accident in the gulf, the Obama administration announced it would suspend any additional offshore oil lease sales while it investigates what new technology is needed to prevent another such deadly blowout. The administration also on Thursday halted a planned lease sale in Atlantic waters off the coast of Virginia. Shell is waiting on the final approval from MMS as well as an appeal of the Environmental Protection Agency's decision to issue air permits for its exploratory vessels and rigs. It's also awaiting the outcome of a last-minute federal court challenge by environmental groups.