The move by the Interior Department’s Bureau of Ocean Energy Management is designed to ensure that the companies have set aside enough money to dismantle offshore facilities once oil and gas stops flowing.
Although other gravel islands have been built in the Beaufort Sea, Hilcorp’s proposed Liberty project would be the first oil production facility located entirely in federal waters off the Alaska coast.
With just five companies participating and only 33 leases sold, the turnout was the lowest western Gulf auction since area-wide leasing began in 1983, according to the Bureau of Ocean Energy Management.
Shell’s work in the Arctic is far from guaranteed. The company is still seeking required drilling permits and repairs for a contracted icebreaker that is supposed to help safeguard operations this summer.
In a four-page letter to Interior Secretary Sally Jewell, 10 environmental groups delivered their strongest argument yet that Shell’s exploration plan is invalid and the Interior Department would violate federal law if it issued drilling permits for Shell’s planned wells in the Chukchi Sea.
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