Obama to Shell's 2012 Arctic Prgram: "Drill Baby Drill"!

The Obama administration on Thursday agreed to immediately allow Shell to launch drilling in Arctic waters, even though a critical oil spill containment barge is still a two-week trek away.
Administration officials stressed that the company would only be allowed to begin initial site work and drilling — without penetrating underground oil reservoirs — until that emergency equipment has won Coast Guard certification and is on site.
But environmentalists accused the White House of bending over backwards to satisfy Shell and oil drilling advocates in an election year.
“Shell will not be authorized to drill into areas that may contain oil unless and until the required spill containment system is fully certified, inspected and located in the Arctic,” said James Watson, director of the Interior Department’s Bureau of Safety and Environmental Enforcement. But the company will be able “to move forward with limited activities well short of oil-bearing zones that can be done safely now prior to the certification and arrival of the containment system.”
The move is aimed at allowing Shell Oil Co. to salvage what’s left of an already brief season for drilling in the remote Beaufort and Chukchi seas before ice encroaches this fall.
The company has spent nearly $5 billion and seven years preparing to drill in the region but it has suffered a series of setbacks in recent weeks _ including long delays in the refurbishment of the 36-year-old Arctic Challenger spill containment barge. That ship is still docked in a Bellingham, Wash., shipyard, where it has been undergoing retrofits.
Under permits just approved by the safety bureau, Shell is authorized to begin initial preparation work at its Chukchi Sea drilling site, including excavating a 20-foot by 40-foot mud line cellar, designed to hold a critical emergency device known as a blowout preventer just below the sea floor.
The company also will be allowed to begin so-called “top-hole drilling,” by setting the first two strings of casing into shallow non-oil bearing zones.
When the Interior Department approved Shell’s broad drilling blueprints for the Beaufort and Chukchi seas, it said permits for individual wells were contingent on the company satisfying the terms of its oil spill response plan, including staging a system for capping and containing a runaway underwater well in between the sites.
And in a conference call with reporters on Aug. 13, Interior Secretary Ken Salazar said he was committed to stiff oversight of Shell.
“I will hold their feet to the fire in terms of making sure we are doing everything we can to abide by the regulation we have set and to make sure that the environment and the Arctic seas are protected by their activities,” Salazar said at the time.
Salazar insisted today that the administration is not backing down from that approach.
“In terms of our approach, it has not changed at all,” Salazar told reporters on a conference call. “We are holding Shell’s’s feet to the fire. Unless the Arctic Challenger gets certified and has the containment capacity that is required, there will be no penetration in the oil-bearing zones in the Arctic, period, end of story.”
“The Challenger itself will have to be on site before they penetrate oil-bearing zones,” Salazar added.
Deputy Interior Secretary David Hayes noted that while the Challenger needs to be on the scene during drilling into areas that could hold oil, “it is equally clear that the preparatory work prior to going into an oil-bearing zone is in a different category.”
“The Challenger isn’t needed because there is not the opportunity for an oil spill,” Hayes said.
Before the Arctic Challenger could begin a two-week (or longer) journey to the Chukchi Sea, it has to be certified by the Coast Guard and successfully complete a drill for the safety bureau. Coast Guard certification still could be roughly a week away.
Shell spokeswoman Kelly op de Weegh said the decision “reflects the national importance of exploring the energy resource offshore Alaska.”
“Shell has dedicated more than six years to gain the confidence and trust of regulators and to earn the right to begin this historic operation,” she said. “In the weeks ahead, we look forward to operating safely and responsibly, putting Americans to work, and finding out even more about the oil and gas reserves, which are believed to lie under Alaska’s Chukchi Sea.”
Environmental activists who oppose Arctic drilling suggested that the government’s accommodation of Shell begs the question of who is in charge.
Mike LeVine, a senior counsel with the conservation group Oceana, accused the government of continuing “to bend over backward to accommodate a company that is still not ready to drill.”
“Companies like Shell must be held to the highest standards,” LeVine said. “Bending the rules because Shell is not ready is not consistent with that promise.”
Andrew Hartsig, the Arctic program director for the Ocean Conservancy, called the move “disappointing.”
“Shell will be authorized to drill approximately 1,400 feet down into the ocean floor even though its oil spill containment barge has not been certified and is still two weeks away from the drilling site,” Hartsig said. “Secretary Salazar claims he is holding Shell to the highest standards, but today’s decision tells a much different story.”
Shell still would need to get government-approved amendments to its permits to continue drilling its Arctic wells and go beyond the initial work at those sites. The company must halt drilling in hydrocarbon-bearing zones by Sept. 24 in the Chukchi Sea and Oct. 31 in the Beaufort Sea.
Shell officials have said just two out of 10 planned wells have a chance of being completed this year. And Shell Alaska Vice President Pete Slaiby has conceded that even those two might be a challenge under the abbreviated schedule.


Great News.

What a joke. they can drill, but not in any place where there might be oil. Its nothing more than a sham to make the sheeple think he is acting favorably to the oil industry. He’s pandering for votes again.
After reading all the negativity about “Shell’s Clown Circus” in the arctic, it seems to me that obama is once again backing another loser, a la Solyndra et al…

Aaaaah okay.

Chief, please check the paint locker. I think some thinners might have gone missing. Next week it’ll be the carbon cleaner.

[QUOTE=seadog6608;80530]What a joke. they can drill, but not in any place where there might be oil. Its nothing more than a sham to make the sheeple think he is acting favorably to the oil industry. [B][U]He’s pandering for votes again.[/U][/B]
After reading all the negativity about “Shell’s Clown Circus” in the arctic, it seems to me that obama is once again backing another loser, a la Solyndra et al…[/QUOTE]

Yup I agree, purely a political move to make him look good.

This is absolutely fabulous news. America needs to make progress developing IT’S vast new Arctic oil frontier much more than Shell does. We need the energy security, jobs,and economic growth that it will bring. Its really unfortunate that America’s new oil frontier has gotten off to such a bad start as a result of Shell’s many missteps and misfortunes.

I do not know very much about the drilling process, but Shell’s request to start drilling seems very reasonable (and long overdue) to me, as does the Obama Administration’s decision to allow Shell to proceed. It takes a certain amount of time set up a rig at a well site, set the outer casing, and start “makin’ hole.” There is no risk of a spill at this stage. Having these wells partially drilled and ready to actually commence drilling for oil as soon as the ice permits next summer will be a very good head start for Shell, and more importantly America, in 2013.

I sure hope that Shell’s oil spill barge is completed soon and on location in time for Shell to at least complete one well in 2012 — and hopefully to find a vast new oil field in American waters.

I don’t give fig why Obama is allowing Shell to start drilling, or even whether it helps or hurts his reelection chances. The important thing is that Shell can start drilling and bring America one step closer to finding out if there is commercially viable Arctic offshore oil.

Chief - I think a whole 25 liter pail of thinners has gone missing.

I ain’t much of an expert, but in business if I make a promise to do something, I do it. Then, I get paid for what I actually did. If I cannot fdo it, I have to renegotiate with the client, not bill them or refund them. Simple, fair & honest.

Now, Shell agreed to pay a lease. To explore and hopefully develop that lease, they agreed to do some things to government required. Without debating the requirements or getting all technical about the details, the one thing that is clear is that Shell agreed to do some things. Those things we here may agree or disagree with, but we ain’t part of the contract.

So along the way Shell could not fulfill a part of their part of the bargain. Again, not getting technical and not fighting over the details, this is just a fact.

So Shell proposed doing something in the meantime to get moving and see some return, whether we think it valid or not — on their investment.

The government agreed what was proposed was consistent with the baseline agreement.

It’s just 'effing business.

Don’t get all hysterical after getting a whiff of the thinners.

I hope they succeed up there, it will be good for the industry, our country, and each one of us even slightly involved with the oil field.

I would still like to see Sarah Palin in a cheer leader’s out fit waving her pom-poms yelling drill baby, drill.

Darned right - even from down here in Chile !

Pass the Gamlen

I need a whiff of something really strong.

[QUOTE=+A465B;80533]Aaaaah okay.

Chief, please check the paint locker. I think some thinners might have gone missing. Next week it’ll be the carbon cleaner.[/QUOTE]Are you trying to say that I did not read tons of negative comments about this project on this site. That I did not read the expression “Shell’s Clown Circus” on this site. That its all just a “pigment” of my paint locker imagination? Don’t get me wrong. I want us drilling up there and using our resources to provide jobs and energy for America. I am just extremely suspicious of the obama regime and their motivations. Like I said, He is pandering for votes. He has screwed the O & G segment of our industry with a handful of sandy vasoline and I trust NOTHING he says or does. He gives the okay to drill as long as there is no oil where they drill. And he gives that okay at the 11th hour before they need to shut down for winter.

Ahhhh okay.

Shell has a reason for investing in the effort.

They have the gear they think they need up there - apart from the barge and safety containment they agreed (in advance) to provide.

Soooo- being really clever after being faced with screw up(s), they asked government permission to do the prepatory work that is required (no matter what) to build the wells they intend to drill.

The big bad government, being really clever and accepting that absolutely vote pandering logic - considered;

(1) the work needed to be done regardless,
(2) Shell is spending boatloads of cash,
(3) time is of the esscence, and
(4) the work Shell asked permission for is not going to cause a spill

They took a huge leap of faith and agreed ! Imagine that.

While I do appreciate the pigments of imagination, please stop whiffing the thinners and start worrying about how much your private health insurance is gong to cost without Medicare, as a 75 year old, with cancer, an enlarged prostate and known arterial blockage, living off your 401k savings. Now pleeeease pass the carbon cleaner.

I definitely need a whiff.

Sounds like you’ve already been huffing the stuff. this regime has been putting one obstacle after another on drilling. In the Arctic and in the Gulf. Leap of faith? Please. all they did was give Shell a parking permit.

Okay. You win.

Now pass the thinners … the wiper already drank all the Aqua Velva (true).

Have a pleasant evening.

Its freezing here and I aint’ looking forward to a rainy week on deck.

I’m still not voting for the current white house occupants.

As far as I am concerned it really doesn’t matter anymore. Shell’s program for 2012 has failed to accomplish close to what a billion dollars was spent to do. At this point in time it is far too little too late regardless of this change in position by the Administration. Besides all that can be done is to spud in the wells only and nothing more. Maybe Shell will have learned an expensive lesson though and next year will be more successful?

One can only hope…

Back when I was young, I think Jimmy Carter was President (and clearly the worst President since Herbert Hoover), a bunch of us were arguing about which candidate would make the best President. A sage old guy said: The longer I live, the more apparent it becomes, that it doesn’t make much difference which candidate gets elected."

I thought that was probably the stupidest thing I had ever heard. Certainly the stupidest thing I had ever heard that savvy old guy say. Now that I’m an old guy, I understand what he meant. Just about everyone that gets elected turns out to be a big disappointment who only makes things worse.

When it comes to government, small is beautiful, and less is more. But there are now three things that are certain in life: death, taxes, and ever bigger government.

Good things (like Shell finding a lot of oil in the Arctic) happen in spite of the government, not because of it.

Shell has made some big mistakes and they have had some bad luck. The thing that made me doubt Shell’s competence and credibility the most were all the press releases about how drilling was being held up by the heaviest ice conditions in years, when in fact as anyone with the internet can see, 2012 is record year for ice minimums, and the areas where Shell wants to drill have been sufficiently clear of ice since June. Eventually, Shell was forced to admit that drilling was being held up only because the oil spill barge was not ready. All this is just melt water now.

The important thing is that Shell starts drilling ASAP and makes some progress toward finding America’s next great oil find. America cannot afford to wait. I fear that if Shell does not find some oil this year, and Obama gets reelected, there may not be a drilling program next year. It could be four more years before anyone gets a chance to drill in the Arctic again. So let’s wish Shell luck now.


Shell Wins U.S. Permit to Prepare for Arctic Drilling
By Kasia Klimasinska - Aug 30, 2012 6:55 PM ET

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Royal Dutch Shell Plc (RDSA) said it will be difficult to complete an exploratory well in the Chukchi Sea off Alaska this year even after the company received a permit to begin limited preparatory work.

Shell will be allowed to drill 1,400 feet under the seabed with the permit granted yesterday by the U.S. Interior Department. The company still needs U.S. Coast Guard approval for a spill-containment barge before a permit can be issued to drill about 4,000 feet deeper, into oil reservoirs.
Enlarge image Shell Wins Permit to Prepare for Arctic Drilling, U.S. Says

Royal Dutch Shell Plc can dig a 40-foot hole on the floor of the Chukchi Sea to install equipment that will prevent well blowouts, Interior Secretary Ken Salazar said today. Photographer: Simon Dawson/Bloomberg

For the company that spent $4.5 billion to explore the Chukchi and Beaufort seas time is running out – it takes at least 20 days to complete a well and Shell has to stop drilling in the oil-bearing zone in the Chukchi Sea by Sept. 24. The company asked for an extension, a request the Interior Department said it is still considering.

Completing a well in the Chukchi “will be very, very difficult without the extension,” Pete Slaiby, Shell’s head of Alaska operations, told reporters during a conference call from Anchorage yesterday.

Shell, which initially planned five wells this year, was delayed by ice and getting approvals for a barge it plans to use for oil spill containment.

Shell expects the Noble Discoverer drilling rig to arrive on drilling site in the Chukchi Sea today and start the preparatory work next week, Slaiby said. The work allowed under yesterday’s permit accounts for about two weeks out of the time required for an exploratory well, he said.
Coast Guard

The company has yet to get the U.S. Coast Guard certificate for the barge and Interior Department permit to drill into the oil fields.

Environmental groups, which oppose Arctic drilling, criticized the decision to allow Shell to do preparatory work, saying that even shallow drilling is risky and problems with the barge show that Shell is unprepared to operate in extreme Arctic conditions.

“It is disappointing that our government continues to bend over backward to accommodate a company that is still not ready to drill,” Michael LeVine, senior counsel for Washington-based group Oceana, said in an e-mail today. “There is no price tag on the Arctic. No matter how much money the company spends or how many vessels it mobilizes, Shell should not be allowed put the Arctic Ocean at risk.”

Interior Secretary Ken Salazar said drilling to 1,400 feet is safe, and that the agency will ensure Shell will meet all requirements before it’s allowed to reach to the offshore oil fields.

“We are holding Shell’s feet to the fire,” Salazar said during a conference call yesterday. “We don’t even know if there is going to be exploration.”

While work in the Beaufort Sea can continue until the end of October, the company hasn’t obtained a permit to start preparatory drilling there. It is seeking one.

To contact the reporter on this story: Katarzyna Klimasinska in Washington at kklimasinska@bloomberg.net

To contact the editor responsible for this story: Jon Morgan at jmorgan97@bloomberg.net

From Fuel Fix

NOBLE DISCOVERER receives temporary air quality permit from EPA

ANCHORAGE, Alaska — Royal Dutch Shell PLC has received permission to operate its drill ship in the Chukchi Sea under a temporary revision to its air permit, clearing another hurdle in its quest to drill exploratory oil wells in the Arctic Ocean this year.

A spokesman for the Environmental Protection Agency said it will issue a one-year air permit compliance order for Shell’s activities off Alaska’s northwest coast.

“The order sets interim air pollution emissions limits for the company’s activities, and ensures that Shell’s operations will meet congressionally mandated air quality standards under the Clean Air Act until the agency completes a full review of Shell’s application to revise the permit,” spokesman David Bloomgren said.

The decision is more good news for Shell, which on Thursday received permission to begin preliminary excavation work on Chukchi wells while it awaits certification of its oil spill response barge, as long as it does not dig into petroleum zones.

“It’s an essential piece for us getting to work in the Chukchi,” Shell Alaska spokesman Curtis Smith said of the compliance order.

The company applied for the temporary measure after determining the air standards could not be attained on its drill ship, the Noble Discoverer, using the best current control technology, Smith said. Shell has said the vessel’s generator engines tested “slightly above” permit levels for ammonia and nitrous oxide. Seeking the compliance order set in motion a review for changes to the permit for 2013.

Bloomgren said in an email response to questions that EPA expects the Discoverer’s overall emissions for this drilling season to be lower under the compliance order than the original permit allowed.

The compliance order will expire in one year, Bloomgren said, and does not waive Shell’s permit requirements or any air quality standards.

“Any proposed revisions to the permit will be subject to full public review and comment,” he said.

The overall air permit is the subject of a lawsuit by environmental groups that bitterly oppose proposed drilling in Arctic Ocean waters of the Chukchi and Beaufort seas. They claim oil companies have not demonstrated the ability to clean up a crude oil spill in waters clogged with floating ice. They also say a fragile environment teeming with endangered or threatened whales, polar bears, walrus and ice seals, and already hammered by climate warming, will be further damaged by noise and traffic.

Leah Donahey, western Arctic and ocean program director for the Alaska Wilderness League, called the EPA’s decision disappointing.

“We really think that issuing this waiver, allowing Shell to not meet the pollution limits that were required under the permits, gives Shell the right to move forward. We think that’s the wrong direction. They should make Shell stick to the clear air regulation that they put in their initial permit,” Donahey said.

“So much for holding Shell’s feet to the fire,” said Rebecca Noblin, an attorney for the Center for Biological Diversity, referring to Interior Secretary Ken Salazar’s promise on Arctic offshore development. “The Obama administration is bending over backward to give Shell what it wants.”