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Shell scales back offshore oil drilling to 2 wells in Alaska's Arctic

Alex DeMarban
Earl Finkler photo

After weeks of speculation about Royal Dutch Shell's drilling plans in Alaska's Arctic, Shell's chief executive told analysts Thursday that the oil company now plans to drill only two exploration wells during a shortened summer season, according to the Houston Chronicle's Fuel Fix blog

Shell had hoped to drill up to five wells this year in the Beaufort and Chukchi seas, but lingering sea ice that complicates navigation has thrown a wrench into those plans, as the company also awaits regulatory approval in key areas.

Ice chunks clogging Alaska's northern coastline might clear out by the first or second week of August, moving to the north before returning, Kathleen Cole, the National Weather Service's top ice expert in Alaska, told the Alaska Dispatch.

Shell has committed to not breaking through sea ice to reach its prospects. So the company's two huge drilling rigs and a fleet of support vessels await an opening in the staging area of Unalaska, hundreds of miles from the drilling grounds.  

If Shell can't begin until mid-August, the company would have about six weeks or less to drill in the Chukchi Sea prospect off Northwest Alaska under current timelines. It would have about 10 weeks or less in the Beaufort Sea prospect, which is closer to the Canada maritime border.  

In addition to plans to drilling two wells this summer, Shell chief executive Peter Voser said Shell could also conduct early drilling on other wells, FuelFix reported. But it can't sink bits to depths containing hydrocarbons.

Cole said this year's ice buildup along the coast isn't much worse than past years. In fact, seven of the last 10 years have seen lots of ice in the region.

Last year was a great year for drilling, when the ice quickly left the coast. That was unusual, but similar to 2007 when the ice just "blew off the coast," she said.

"This is how the Arctic behaves," she said. "Some years the ice goes away quickly, some years it will stay. And that is something you have to expect. Shell has worked in the Arctic before. I'm sure this is not a surprise to them either."

The water along Alaska's northern coast generally isn't chock-solid with ice, but in many areas the sea is more than 50 percent filled with ice. 

Cole said she's working closely with ice experts at Shell under the philosophy that two heads will do a better job of understanding the ice than one. The company regularly sends her observations from overflights and ships, supplementing what she receives by satellite. The updates boost the limited tools available for ice forecasting, a fledgling effort that she compared to weather forecasting in the 1990s.

Until not long ago, ice forecasting focused on seasonal, long-term views, said Cole, who's got 16 years on the job in Alaska. Providing daily predictions have become increasingly important as interest in Arctic development and shipping has blossomed. 

"There is such little information that this is helping us quite a bit," she said of Shell's contributions. 

Contact  Alex DeMarban at alex(at)alaskadispatch.com