Groups sue agency to block Shell’s Arctic offshore drilling

Jun 2, 2015, 3:24 PM

ANCHORAGE, Alaska (AP) — Ten environmental groups Tuesday sued a federal agency over its approval of a plan by Royal Dutch Shell PLC for exploratory petroleum drilling off Alaska’s northwest coast.

The Bureau of Ocean Energy Management last month signed off on Shell’s exploratory drilling plan in the Chukchi Sea, which calls for two drill rigs and a support flotilla that includes spill-response vessels.

Drilling in the Arctic Ocean region is opposed by environmental groups that contend oil companies are not equipped to deal with a major blowout or spill in a part of the world lacking deep-water ports, major airports and other infrastructure routinely present in other drilling areas. They also say drilling will harm wildlife already hurt by the effects of climate warming.

The groups say federal regulators’ review of the Shell exploratory drilling plan was cursory.

“They approved this massive industrial undertaking — with two drill ships, 19 support vessels, helicopters, all operating in really important walrus habitat and habitat for bowhead and gray whales — on a 30-day, rushed timeframe, with just an environmental assessment and a conclusion that there would be no significant impact,” said Erik Grafe, an attorney for Earthjustice, which is representing the groups. “The whole thing was rushed, and it’s not surprising that there are flaws in the analysis.”

Shell spokesman Curtis Smith, reached by phone in Washington, D.C., said the lawsuit was not a surprise. “We expect all aspect of our plans, including our leases and permits, to be challenged in court by many of the same organizations that have historically used legal maneuvers to delay Arctic exploration,” he said.

Shell for eight years has pursued exploratory drilling off Alaska, and its plans are arguably the most scrutinized in North American history, Smith said.

“We believe this most recent exploration plan is robust and will withstand further legal scrutiny,” he said.

Bureau of Ocean Energy Management spokesman John Callahan said the agency was aware of the lawsuit. “Other than that, we cannot comment on pending litigation,” he said by email.

Under rules governing offshore drilling, requests for review of agency approvals are filed in federal appeals court. The lawsuit was filed in the 9th Circuit Court of Appeals.

In the filing Tuesday, the groups were required only to request a review. Briefs outlining specific flaws in the Bureau of Ocean Energy Management’s review would be required later.

The parties could request an expedited schedule. The environmental groups also could ask for an injunction to halt drilling in 2015 before the issue is resolved.

The U.S. Geological Survey estimates there are more than 26 billion barrels of oil in the Alaska outer continental shelf, a source that could be moved by undersea and overland pipe to keep the trans-Alaska pipeline vital as other fields diminish.

Shell was the most robust bidder in a 2008 Chukchi Sea lease sale, spending $2.1 billion on leases.

Exploratory drilling was delayed in part by a lawsuit that successfully challenged environmental work done by the federal government before putting underwater tracts up for auction.

Shell estimates it has spent upward of $7 billion on its Arctic offshore drilling program in U.S. waters. But the company has yet to complete an exploratory well that could confirm oil in profitable quantities.

Shell has staged a drill vessel and a support fleet in Seattle in anticipation of exploratory drilling during the open-water season this summer. Shell last drilled in the Chukchi and Beaufort Seas in 2012. The vessels were not allowed to drill into petroleum-bearing rock because the required equipment to respond to spills was not on hand.

The company experienced major problems after the season. The Kulluk, a conical drill barge used in the Beaufort, broke loose from its tow vessel and ran aground off an island near Kodiak while in transit across the Gulf of Alaska.

Shell contractor Noble Drilling U.S. LLC, owner of the Noble Discoverer, was convicted of felony maritime and safety felonies on the vessel and was fined $12.5 million.

The groups suing include the Alaska Wilderness League, Center for Biological Diversity, Friends of the Earth, National Audubon Society, Natural Resources Defense Council, Northern Alaska Environmental Center, Pacific Environment, Resisting Environmental Destruction on Indigenous Lands, Sierra Club and The Wilderness Society.

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Groups sue agency to block Shell’s Arctic offshore drilling