Q&A: Author talks challenges, compromises for Shell in Arctic

In “The Eskimo and the Oil Man,” author Bob Reiss tells the story of planned oil exploration in Arctic waters through the eyes of two people. One is Edward Itta, an Inupiat leader and whaler on Alaska’s North Slope. The other is Shell Alaska Vice President Pete Slaiby, the man who is leading that company’s pursuit of drilling in the Beaufort and Chukchi seas this summer.

Reiss fielded our questions about the book and what he learned about the planned drilling during his research.

Q: In Alaska, there is this constant push and pull between energy development and conservation. How significant and challenging is this balance, especially for native Alaskans such as Edward Itta?

A: “(For Itta), it’s less a question of bouncing back and forth between extremes and more of a question of seeking a balance between those two things. In the state, you can find people who want oil development at any price, and people who oppose it at any price. But Edward’s whole public career was one of seeking balance. He had such a terrible choice — such an amazingly weighty choice — to be the person who could be responsible for damaging a 4,000-year-old culture and the environmental base of it or could be responsible for cutting off the public funds that pay for their rescue squads, their roads, their old folks homes (and) basic amenities.

When you’re talking about people on the north slope, it’s not just a question of a car, or a job or a restaurant. It’s really a question about basics. I always thought of (Itta) as poised on this knife edge of a terrible choice. I always thought of him as a kind of point man of a whole culture who had to deal with that choice.”

Q: In recent years, Slaiby and Shell have made a number of concessions to local communities. How significant were these concessions in muting opposition and winning support?

A: “A huge reason why the Eskimos opposed Shell in the beginning is because Shell refused to pull out during the bowhead [whale] migration. They offered to stop for a few days but they didn’t pay any attention to native concerns, and they acknowledged that was a big mistake. Now they are going to lay off, and that is hugely significant on the North Slope.”

“There’s another issue as well and it was the drill cuttings, which are the muds that are brought up while you’re drilling. Originally, Shell planned to dump those back into the ocean. A principle reason why the whaling captains opposed them was because of that. So when Shell agreed this year to carry away the cuttings, that was huge as well.”

“Early on, there was an incident with one of the whaling captains and Pete Slaiby, where Slaiby was telling the whaling captains at some meeting that it was perfectly safe to put these drill cuttings back in the ocean. One of the whale captains was getting angrier and angrier. it was lunch time and they were getting trays of food and he said to Pete, ‘Why don’t you take that tray of food and run it through the drill cuttings. Would you eat the stuff on that plate? Because we eat the whales.'”

Q: Has Shell heard the concerns of the native Alaskans?

A: “Shell definitely heard the concerns and Shell definitely responded to them. They were forced to respond to them. They didn’t do that out of the goodness of their heart. But they definitely responded to them.”

“Shell has no intention of pulling oil out of the ground this year, they’re not allowed to pull oil out of the ground and their plan doesn’t include pulling anything out of the ground. The whole purpose of exploratory drilling is just to see if the oil is there. Shell believes and the government believes there’s three times as much oil down there as has been pulled out of the Gulf of Mexico in the last 20 years. That’s a belief. There isn’t any proof. The whole interesting thing about this fight is that this is a fight over whether or not we get to see whether the oil is really there.”

“If the oil is really there, a whole new process of permissions and applications and permits and fights starts so that a minimum of 10 years would pass in a best case scenario before Shell would be able to pull oil out of the ground. The whole fight this year is about just whether they can explore.”

Q: Some have said Shell is more skilled than some of its counterparts in navigating the environmental reviews that are required for this exploration and dealing with Washington, D.C. Is it at all noteworthy that Shell is leading the way here and that ConocoPhillips and Statoil are essentially waiting until next year or later to pursue their Arctic drilling programs?

A: “Shell leads with their chin, as one ConocoPhillips executive tells me. Shell has also been a technological pioneer in moving into the oceans in general. It was Shell down in the Gulf that invented the deep-sea drilling apparatus. So in terms of their culture it’s not illogical that they might be first in a new area.”

“As to how savvy they are in Washington, well, how savvy are they? They pay $2 billion for leases, they ignored concerns and got shut down in court (and) they were unable to drill during the Bush administration, which was quite friendly to offshore oil. … Washington hasn’t rolled over for Shell I think in any way shape or form. If anything, Washington has driven them crazy for the last four or five years.”