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New era in Alaska drilling looms

After a bruising environmental battle, Shell gets its rig set for the north coast.

March 04, 2012|Kim Murphy
  • Shell Oil's Kulluk oil drilling rig, with downtown Seattle in the background. By July it's expected to be at work off the north coast of Alaska.
Shell Oil's Kulluk oil drilling rig, with downtown Seattle in the… (Elaine Thompson, Associated…)

SEATTLE — Amid the tangle of towering steel, heavy cranes and overcast skies of Seattle's busy commercial shipyards, Shell Oil's massive Kulluk drilling rig is preparing to push off for the Arctic Ocean.

When it does, America's balance between energy needs and environmental fears will enter a new era. Barring unexpected court or regulatory action, by July the Kulluk will begin drilling exploratory oil wells in the frigid waters off Alaska's northern coast.

After one of the biggest environmental fights in the U.S. in decades, there is a palpable sense of all-systems-go on the dock. Shell has invested $4 billion leading up to this moment, hoping the new wells will open the tap on an undersea field that could be one of the biggest ever discovered in the U.S. The Obama administration has given all but the final go-ahead, sensing the potential of 500,000 gallons a day of new oil flowing into the trans-Alaska pipeline.

At a nearby slip, the 301-foot Nanuq is also preparing to steam north. Its job will be to contain and clean any oil spills created by the Kulluk or its companion rig, the Discoverer. The question is whether it and several companion vessels are up to the task.

For The Record
Los Angeles Times Wednesday, March 07, 2012 Home Edition Main News Part A Page 4 News Desk 1 inches; 43 words Type of Material: Correction
Arctic drilling: An article in the March 4 Section A about oil exploration off the Alaska coast said that Shell's drilling program would eventually add 500,000 gallons a day of oil to the Trans-Alaska pipeline. The correct figure is 500,000 barrels a day.

Conservationists fear that a spill in these fragile and forbidding waters, marbled with ice during the spring and fall and shrouded in darkness by winter, could send a deadly pool of oil seeping below that ice -- creating a catastrophe that would make BP's Deepwater Horizon spill seem like an easy cleanup by comparison.

The Beaufort and Chukchi seas, where the Kulluk is headed, may be so remote few humans will ever see them, but they are the nurseries of the earth.

Tens of thousands of familiar American birds make epic journeys each year to the Arctic to feed and nest. The austere waters nurture food-chain building blocks for whales, walruses, seals and polar bears. Struggling Eskimo communities depend almost completely on these animals for sustenance as winter temperatures plunge to 40 degrees below zero.

Even if it doesn't spill a drop of oil, Shell's fleet will release thousands of tons of industrial carbon, nitrogen dioxide and other pollutants into the air every year, adding to levels of toxic chemicals and acid in the northern waters.

"It is beyond the pale of stupidity that in the face of everything that's happening in the Arctic that we would launch a drilling program," said Jim Ayers, former director of the Exxon Valdez Trustees Council, who helped review the Deepwater Horizon oil spill in the Gulf of Mexico for the U.S. Coast Guard.

Both Shell and environmentalists are rushing to court for last-minute legal reviews.

But aboard the Nanuq, Shell's vice president for Alaska operations, Pete Slaiby, is preparing to see the last bureaucratic hurdles in his rear-view mirror. "We're optimistic we're going to get there in the next couple of weeks," he said. "At this point, we are planning on drilling this year unless a federal agency or court action determines we will not."


Spill preparation

The only full cleanup drill conducted in icy waters off Alaska occurred around a BP near-shore project in 1999 -- and was quickly termed an embarrassing failure. Ice knocked over booms. Collection hoses froze.

Oil industry officials say they've had more than 10 years to improve the technology, and Shell has proposed to deploy an entire fleet of heavily equipped response vessels near its rigs, ready to pounce if an accident happens. Yet deep worries remain.

"Most of the spill equipment they have can't work in the weather we're talking about," said Layla Hughes, Arctic representative for the World Wildlife Fund, who recently led reporters on a renegade tour of the Seattle shipyards to view the Kulluk.

"This is a fairly old rig that hasn't drilled a well in 18 years. It's been what they call cold-stacked -- frozen in the ice in a little port in the Canadian Arctic," Hughes said. "Is this what they call the best available technology?"

Slaiby said Shell was accustomed to drilling in formidable latitudes. The Atlantic's North Sea has bigger waves and wind than do the Beaufort and Chukchi seas, he says, and Alaska's Cook Inlet has stronger currents.

The company drilled a series of exploration wells in the Beaufort and Chukchi seas beginning in the late 1980s without serious incident.

"What I've learned working around the world is everybody wants to think their ocean is the most ferocious and baddest place to work in the world," he said. "It is serious stuff, but these issues, we've tackled as an industry four decades ago."

The dramatic shrinkage of sea ice has made offshore oil exploration in the Arctic an easier proposition than it once was. Shell believes the July-October window under which it will be allowed to operate in the Beaufort (ending 38 days earlier in the Chukchi) will enable it to drill in a minimum of ice.

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