Shell expects to continue with Arctic plans

Officials say they don't think Gulf spill will delay remaining permits

Posted: Friday, April 30, 2010

FAIRBANKS - A large oil spill in the Gulf of Mexico has come at a tricky time for two companies seeking to increase Arctic exploration.

The Gulf spill occurred weeks after Shell and ConocoPhillips said they would boost oil-exploration efforts in the Chukchi and Beaufort seas. Shell, which paid $2 billion for offshore leases, recently secured key air quality permits from the Environmental Protection Agency.

Shell spokesman Curtis Smith, in an e-mail message to the Fairbanks Daily News-Miner, said company officials don't think the Gulf spill will delay the remaining permits.

"We don't have any reason to believe those outstanding permits will be impacted by recent events in the Gulf of Mexico," Smith wrote.

Janice Hastings, a Seattle-based deputy air quality manager for the EPA, said the permits would be effective once they clear early May appeal deadlines.

A spokeswoman for ConocoPhillips, which paid $506 million for Arctic development rights, declined comment on the spill's implications for offshore activity.

The Gulf disaster occurred when a BP-leased oil rig exploded and sank last week; 11 crew members remained missing Thursday and oil from the spill moved to within a dozen miles of the coast.

Pam Miller, an arctic specialist with the Fairbanks-based Northern Alaska Environmental Center, said the spill should prompt a time out. The accident, she said, reinforces the need to study the impact of Arctic development on wildlife and the complications of mopping up oil spills in icy waters.

"We think there should be a time out from leasing and drilling," Miller said. "We should take a cautious, science-based approach to development."

Sen. Lisa Murkowski said it will take months to understand the accident and its implications for offshore exploration in the Arctic. The Senate Committee on Energy and Natural Resources, on which Murkowski is ranking Republican, will hold a hearing next week on federal Outer Continental Shelf development plans.

"As we look to expand exploration off our nation's coasts, it's critical that we take every possible precaution to guard against similar accidents," Murkowski said in a statement. "It's imperative that we find out everything we can about what went wrong on the Horizon."

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