Shell tested its first line of defense against runaway Arctic oil wells for federal inspectors on Monday, marking a major step in the company’s final preparations to launch exploratory drilling in seas north of Alaska.
The tests focused on the capping stack that Shell intends to station between planned drilling operations in the Chukchi and Beaufort seas this summer in case of an emergency.
Marine tracking data showed a Shell ship carrying the capping stack circled an area of Puget Sound on Monday after other Shell support vessels previously docked in Seattle, Tacoma, Wash., and Portland, Ore., moved nearby.
In a conference call with reporters Tuesday, Interior Secretary Ken Salazar confirmed that the deployment had taken place and predicted that Shell would win its permits to drill individual wells in the Chukchi and Beaufort seas this summer.
“We are still in the process of doing the inspections and making sure the (applications for permits to drill) meet the requirements. Until all those requirements are met, no permit will be issued, but i do anticipate — having seen the conditions that Shell has already met — that it is probable that they are going to get these permits,” Salazar said. “It is highly likely the permits will be issued.”
Salazar also insisted that “there’s not going to be an oil spill” in the Arctic waters where Shell intends to drill, because the company’s plans have been so heavily scrutinized.
During Monday’s deployment drill, the capping stack was sent underwater in Puget Sound. Shell spokeswoman Kelly op de Weegh said the capping stack “was deployed to a depth consistent with the shallow-water scenario we will encounter off the coast of Alaska.
“The functionality of the stack was tested and sea water was flowed through the system to test for integrity,” op de Weegh added. “The successful deployment of Shell’s Arctic capping stack in Puget Sound means we are nearing the end of an extremely thorough inspection and permitting process that would allow for exploratory drilling in the Beaufort and Chukchi Seas this summer.”
It was unclear when regulators would conduct a separate test of Shell’s containment system for siphoning off crude oil and gas.
On Tuesday, Salazar was briefing reporters on the next steps in planning for potential energy exploration in Arctic U.S. waters. Salazar and Deputy Interior Secretary David Hayes are discussing ways to boost the safety of offshore drilling with foreign regulators who are convening in Norway for a ministerial forum on the issue Wednesday.
Salazar also was slated to discuss the administration’s handling of a new five-year plan to govern oil and gas leasing on the outer continental shelf from 2012 through 2017.
The Interior Department has been putting the finishing touches on a new five-year OCS plan that would replace the existing blueprint that expires on June 30. A draft plan unveiled earlier this year would schedule 15 lease sales in the five-year period, including three in waters near Alaska, but the auctions of drilling rights in the Chukchi and Beaufort seas would be late in the program, to allow time for additional scientific study.
By contrast, Shell’s planned drilling this summer would be on leases it bought in federal auctions in 2005, 2007 and 2008.
Shell says its capping stack would allow it to choke off flowing hydrocarbons at a damaged subsea well and its containment system could siphon off crude oil and gas, sending it to the surface for collection and flaring.
“While we remain confident in our pre-staged, three-tier oil spill response capability, Shell’s Arctic-engineered capping system will allow for the capture of hydrocarbons at the wellhead in the very unlikely event of a blowout,” op de Weegh said.
Federal regulators in the Interior Department’s Bureau of Safety and Environmental Enforcement conducted a tabletop test to simulate a spill response previously and had planned on testing the basic functions of Shell’s capping stack while on land.
Environmentalists who oppose Shell’s planned drilling say there is no guarantee the capping system would work correctly in remote and choppy Arctic waters. Conservationists also have complained that regulators aren’t requiring Shell to prove it can use its containment system in the Arctic waters where it hopes to be drilling later this summer.
But safety bureau director James Watson defended the planned deployment drill earlier this month in a conference call with reporters. Watson noted that Shell’s emergency containment system would be deployed to the depth it would be needed in an emergency in the relatively shallow Beaufort and Chukchi sea drilling sites.
“We’re going to test this in the subsea conditions that will be the conditions (in which) they are drilling,” Watson said at the time. “The operations are scheduled to be completed before the Arctic ice conditions set in (and suspended if ice encroaches) so there shouldn’t be any situation where there is ice and drilling going on at the same time.”
The government has mandated the use of similar containment equipment for deep-water drilling, in the wake of the 2010 Gulf oil spill.
The Obama administration previously signed off on Shell’s broad drilling blueprints for the region, and the Environmental Protection Agency has issued essential clean air permits for the flotilla of vessels that will be involved in Shell’s operations.
Federal regulators have been reviewing Shell’s applications for permits to drill specific wells in the Chukchi and Beaufort seas. Those drilling permits are the last approvals Shell needs before it can launch its planned exploration, expected to begin next month.
Watson has stressed that Shell must pass a number of inspections by his safety bureau and the Coast Guard before those drilling permits could be issued.
“BSEE will diligently review and monitor Shell’s proposed activities at each stage to ensure they retain compliant with federal regulations and are performed in a safe manner,” Watson told reporters on June 14, after visiting one of Shell’s chosen drilling rigs in a Seattle shipyard. “There are still a number of inspections by BSEE and the U.S. Coast Guard . . . and certifications and testing of Shell’s containment system before a decision will be made on Shell’s applications for permits to drill.”
Shell Oil Co. spent $2.2 billion buying drilling rights in the region during three federal lease sales beginning in 2005 and has since invested billions more trying to overcome regulatory hurdles, environmental concerns and legal challenges to kick off the exploration.
