Obama administration OKs Arctic drilling, but imposes big constraints on Shell

Source: Houston Chronicle

Obama administration OKs Arctic drilling, but imposes big constraints on Shell
Posted on July 22, 2015 | By Jennifer A. Dlouhy

WASHINGTON — Shell is set to launch a new round of Arctic drilling within days, after receiving critical federal permits that could force the company to halt work thousands of feet above potential oil deposits.

Under the limited Interior Department drilling permits, Shell can only focus on one well at a time, and it cannot penetrate potential oil- and gas-bearing zones some 8,000 feet underground, at least until a damaged company-contracted icebreaker returns from repairs in Oregon.

That ship, the MSV Fennica, is meant to keep ice from encroaching on Shell’s drilling operations and is designed to install critical equipment on top of a damaged well in an emergency.

Federal regulators insist that emergency capping stack must be on hand and ready to deploy within 24 hours of an incident. But they decided to follow the same approach used during Shell’s last attempt at Arctic exploration in 2012 when other emergency equipment was unavailable, by allowing initial top hole drilling only. Three years ago, that meant Shell’s wells stopped about 1,300 feet down.


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