Royal Dutch Shell plc .com Rotating Header Image

Shell’s Arctic Drilling Experiment an Epic Failure

January 11, 2013 10:37 AM ET
EXTRACT

In December of 2011, Royal Dutch Shell produced a series of videos advertising the company’s plans to drill for oil in the Arctic Ocean. Their tagline: “It’s time to explore, and Shell is Arctic Ready.”

That slogan sounds rather different after 2012, a year in which little went as the company planned – this week prompting U.S. Secretary of the Interior Ken Salazar to announce an urgent, high-level review of what went wrong. (FULL ARTICLE)
EXTRACT

I reached out to Shell in both Houston and Alaska to gauge the company’s willingness to absorb costs incurred by public entities. Neither location made a representative available to answer questions by deadline. [See update at bottom.] The company did clear up one gauzy point, albeit to other outlets. As we reported earlier this week, Shell was motivated to move the Kulluk when it did to avoid paying tax to Alaska on the rig in the new year. From United Press International:

[Rep. Ed Markey (D-Mass.)], ranking member of the House Natural Resources Committee, said he questioned claims made by Shell that Kulluk was towed from its grounding [site] because of inclement weather.

“Reports that financial considerations rather than safety may have factored into Shell’s considerations, if true, are profoundly troubling,” he said in a letter to Shell Oil President Marvin Odum.

Shell spokesman Curtis Smith told Bloomberg News that avoiding a Jan. 1 tax issue in the state was “a consideration” but “not among the main drivers for our decision to begin moving the Kulluk.”

Shell made a bad bet. Hoping in part to avoid an estimated $6 million tax bill, it decided to risk the stormy weather on Dec. 27. The bet didn’t pay off. (FULL ARTICLE)

EXTRACTS

Royal Dutch Shell deserves to be commended for its handling of the aftermath of the Kulluk grounding. I am very impressed because they listen and care, something that can’t always be said about big companies.

Accidents happen. In this case, Shell’s performance was stellar. I can’t say that about the tug operations that created the problem. Most masters who run that route would have pulled into a sheltered area to wait out the storm. That didn’t happen in this case, so the rig got away. Thankfully, Shell took control and did it in a superb manner. (FULL ARTICLE)

Point-counterpoint: Kulluk grounding shows Shell not ready for Arctic

Shell Oil Company is learning the hard way that Alaska’s waters demand respect. Operating in the Arctic’s remote and difficult conditions requires planning and attention to detail that Shell has not been willing or able to provide. It is well past time to end Shell’s poorly designed and inadequately evaluated gamble in the Arctic. The Department of the Interior must not grant any further approvals and must send Shell out of the Arctic before they do even more serious harm to people and our environment.

The decision to tow the drill rig Kulluk in the middle of winter, and the rig’s subsequent grounding near Kodiak Island is just the latest in a series of mistakes that Shell has made…(FULL ARTICLE)

Comments are closed.

%d bloggers like this: