Shell Oil gets approval to begin Arctic drilling

ANCHORAGE, Alaska -- U.S. Interior Secretary Ken Salazar on Thursday made a surprise announcement that the government will allow Shell Oil Co. to begin well work in the Chukchi Sea this year even before its oil spill containment barge is ready.

Mr. Salazar told reporters in a news briefing that the newly approved work will involve drilling 1,400 feet or more into the sea floor, but that the hole will not reach any oil-bearing zones. So the chance of a spill is virtually nonexistent at this stage, he said.

Environmental groups immediately criticized the decision. Alaska's two senators, Republican Lisa Murkowski and Democrat Mark Begich, both praised it.

Regulators will still hold Shell's "feet to the fire," Mr. Salazar said. Inspectors will be on Shell's rig 24 hours a day as the work is being done, he said. Shell will have to operate under the "closest oversight and most rigorous safety standards ever implemented in the United States," Mr. Salazar said.

Under Thursday's decision, Shell will be allowed to excavate a mud cellar 40 feet deep, then drill a hole 1,400 to 1,500 feet deep. This work will allow Shell to install a critical piece of safety equipment, a blowout preventer, Mr. Salazar said. Shell also will install monitoring instruments to sense for natural gas pockets, regulators said.

Shell's quest to drill in the Alaska Arctic this year has been rife with problems. The major hurdle relates to the oil spill containment barge, the Arctic Challenger, still being worked on and inspected in a Bellingham, Wash., shipyard. Until that vessel is complete and on site, Shell will not be allowed to drill in any oil-bearing zones, Mr. Salazar said.

Shell also has asked to extend its drilling season, which under previous approvals must end Sept. 24 in the Chukchi Sea. Mr. Salazar said no decision will be made on that request until the Challenger is ready.

Thursday's decision doesn't affect Shell's plans in the Beaufort Sea, where its prospect is much closer to shore. Drilling there already can go until Oct. 31.

Oceana and the Center for Biological Diversity were among the groups quick to criticize the development. "It is disappointing that our government continues to bend over backward to accommodate a company that is still not ready to drill," Oceana said in a statement. "Shell, and only Shell, is responsible for the situation in which the company now finds itself. Shell's problems are extensive and well-documented."

Shell's drilling ship, the Noble Discoverer, left Dutch Harbor on Saturday, headed to the Chukchi. "Shell is now only days away from responsibly beginning this critical exploration project and, once again, making energy history offshore Alaska," Shell spokesman Curtis Smith said in a written statement. "When the Noble Discoverer reaches its respective drill site, it will connect with anchors that have been pre-staged in the Chukchi Sea, and drilling will commence."

As Mr. Salazar issued his decision, the Interior Department's Ocean Energy Safety Advisory Committee was meeting in Anchorage, working on oil spill prevention and response. The group, which includes Shell's chief well scientist as well as government regulators, other industry leaders and a Wilderness Society Arctic expert, is recommending that the government adopt Arctic-specific rules for drilling.