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Energy

Shell in Alaska: A timeline

  • Author:
  • Updated: May 31, 2016
  • Published September 28, 2015

1918

Shell geologists take their first look at Alaska.

1952

Shell starts first Alaska geological maps, a project that continued until 1964.

1958

Shell and Humble Oil and Refining Co. drill onshore Bear Creek No. 1 wildcat well on the Alaska Peninsula.

1963

Shell, using a drilling vessel in Cook Inlet, drills the first offshore oil field in Alaska, the Middle Ground Shoal No. 1 discovery well.

1964

Shell installs a permanent offshore drilling and production structure in Middle Shoal Ground in Cook Inlet, the first of 16 offshore platforms. Drilling begins there in 1965.

1976

Shell drills the first exploratory well in the Gulf of Alaska, which is plugged and abandoned.

1979

Shell acquires Beaufort Sea leases in federal lease sale.

1982

Shell completes Seal Island well in the Beaufort Sea, later developed by BP under the name Northstar field Shell drills on Tern Island. Shell strikes oil at Seal Island in 1984. The prospect is later developed by BP as the Northstar unit.

1984-'85

Shell drills two wells in St. George Basin of the eastern Bering Sea.

1988

Shell dominates Chukchi Sea Lease Sale 109, which brings in $478 million in high bids.

1989-'91

Shell completes Klondike, Burger, Popcorn and Crackerjack wells in the Chukchi Sea; finds major gas accumulation at Burger, plus accumulation of liquids.

1991

Shell announces Chukchi discoveries are not commercial and it plans to sell its producing Alaska properties, which include Cook Inlet assets and a 0.14 percent interest in the Prudhoe Bay field; Shell announces it is closing its 50-person Alaska office. Chukchi Sea leases relinquished to the federal government in 1996.

2001

Shell returns to Alaska to bid $2.4 million on 13 onshore leases in a North Slope areawide lease held by the Alaska Division of Oil and Gas.

2005

Shell returns to the Alaska outer continental shelf, submitting $44 million in high bids at Beaufort Sea Lease Sale 195.

2007

Shell spends $39.2 million to pick up tracts at Beaufort Sea Lease Sale 202.

Shell submits plan to drill a dozen or more wells over three years, using two rigs at a time, starting with three wells in 2007. North Slope Borough, Alaska Eskimo Whaling Commission and environmental groups appeal to overturn approval. Borough Mayor Edward Itta criticizes Shell's plans as "too much, too soon, too fast."

2008

Feb. 6: Shell spends over $2.1 billion to win leases in the U.S. Minerals Management Service Chukchi Sea Lease Sale 193. High bids from all companies total over $2.66 billion, a record for any Alaska lease sale.

Nov. 20: 9th Circuit Court of Appeals overturns MMS approval of Shell's plan to drill multiple wells in the Beaufort Sea; The North Slope Borough, Alaska Eskimo Whaling Commission.

Dec. 18: Shell announces it won't drill in the Beaufort in 2009 but will regroup.

2009

MMS approves Shell's scaled-back Beaufort plan, which calls for one rig and one well a year for two years.

Shell submits plan for exploration drilling in Chukchi in 2012.

2010

April 20: Blowout of BP's Macondo well at the Deepwater Horizon rig in the Gulf of Mexico. The blowout kills 11 workers, creates the nation's worst oil spill and triggers a sweeping revision fo federal offshore oil regulation, including a reorganization of the MMS into two separate agencies.

July 21: US District Court Judge Ralph Beistline rules the pre-sale environmental analysis for Lease Seal 193 was inadequate; orders a new remedial analysis. All Chukchi leases are suspended and on-site exploration is put on hold until the newly reorganized BOEM completes the remedial analysis, a process that takes until 2011.

2011

Shell sits out drill season as it awaits EPA's rewrite of a critical air-quality permit that had been overturned on appeal. EPA's Seattle region completed the rewrite and the public review, and issues the new permit in September.

Shell submits a revised Chukchi plan, which wins conditional approval from the new BOEM.

2012

Shell conducts limited exploration, starting a well at the Sivulliq prospect in the Beaufort and another in the Chukchi called Burger A. It is hampered by numerous logistical problems.

Lingering sea ice delays entry into the drilling theater.

Shell is permitted to drill only top hole – not into oil-bearing zones -- because it failed to meet requirements for required oil-spill-response equipment. A dome system aboard the Arctic Challenger barge repeatedly failed U.S. Coast Guard tests, and was repeatedly denied Coast Guard approval. During one sea-trial test in Puget Sound, the dome was crushed and the structure had to be repaired. The ship and dome system eventually won Coast Guard approval in October, too late to be used in the 2012 drill season.

On the way to and from the drilling theater, Shell has numerous problems, mostly on Discoverer – a near-grounding in Unalaska Bay in July, an engine fire in November, detained by Coast Guard in Seward in November and December because of safety and environmental deficiencies.

Dec. 31: Shell loses control of the Kulluk drill ship while trying to tow it through a Gulf of Alaska storm; the ship grounds near Kodiak Island and is wrecked beyond repair, costing Shell its entire 2013 drill season.

2013

Shell suspends the entire 2013 drilling season as Kulluk headed to Asia for repairs.

David Lawrence, Shell executive vice president for Alaska affairs, leaves company.

EPA fines Shell $1.1 million for air-quality violations on Discoverer and Kulluk rigs and support vessels.

2014

Jan. 20: 9th Circuit Court of Appeals rules that environmental studies for 2008 lease sale are still inadequate, kicking off another suspension of Chukchi lease activity while BOEM completes more remedial environmental studies. Shortly after, Shell cancels 2014 drill season while it awaits completion of second round of remedial environmental studies.

In August, Shell submitted a revised Chukchi plan that proposes to have two drill rigs operating simultaneously, with the Polar Pioneer taking the place of the damaged Kulluk.

Dec 19: Shell contractor Noble Drilling ordered to pay $12.2 million to settle criminal charges for environmental and maritime safety violations, mostly aboard the Discoverer.

2015

In the first half of the year, regulatory approvals fall into place for Shell.

BOEM completes its remedial environmental studies for Chukchi leasing, and the Department of Interior affirmed the 2008 lease sale. BOEM approved Shell's exploration plan, which the company had further revised in the spring. BOEM's sister agency, the Bureau of Safety and Environmental Enforcement, gives approvals for Shell to drill two wells, Burger J and Burger V, but stipulates that no penetration of oil-bearing zones unless the icebreaker Fennica and its oil-capping stack are on scene. The Fennica has to be repaired after it is tears part of its hull by striking an uncharted shoal in Unalaska Bay in July.

Shell is dogged by protests through the first half of the year. A Greenpeace-led expedition in May puts activists onto the Polar Pioneer while it was being transported on the high seas. Seattle city officials and local activists try to prevent the Polar Pioneer from using that city's port, and activists try to block the Fennica from leaving Portland, where it got repairs to the hull damaged in Unalaska.

July 30: Shell begins drilling the Burger J well, its first offshore Alaska drilling since 2012.

Sept. 27: Shell says Burger J results are not economic and it will end its Alaska exploration.

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