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Environmentalists Get Surprising Ally in Arctic Drilling Debate

By John M. Biers

TOTAL CEO SEES ARCTIC DRILLING AS RISKY BUSINESS

When was the last time you heard an executive from Big Oil say no thanks to drilling a hot prospect because it was too risky to the environment?

Yet that’s what Total Chief Executive Christophe de Margerie just did with arctic drilling. The feisty de Margerie, in an interview with the Financial Times, is quoted as saying an oil spill in Greenland would ”be a disaster,” and that a leak ”would do too much damage to the image of the company.”

De Margerie did qualify the remarks, saying natural gas drilling in the arctic posed less of a threat than oil drilling. But his comments are sure to prompt a sigh of despair from the oil industry as a whole and particularly from companies active in arctic drilling like Shell and Cairn, which have drilling campaigns in Alaska and Greenland, respectively. Both Shell and Cairn face tough, well-organized environmental campaigns against arctic drilling.

The prospect of arctic riches has left oil and mining companies salivating, especially since global warming will make chipping through all that arctic soil less difficult. Yet de Margerie’s comments reveal a surprising constraint on the forces of development. While U.S. regulators have tightened the rules somewhat on deep-water development, the fact is that deep-water exploration resumed in the U.S. Gulf of Mexico and in other basins expeditiously following the Deepwater Horizon oil spill. To the average bystander, it may have looked as though nothing has changed since the 2010 BP disaster. De Margerie’s comments indicate that’s not the case.

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