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The Anchorage Daily News: Shell still banking on drilling in Alaska

IT’S COMMITTED: Oil giant says it has the experience to do the job right.

By ERIKA BOLSTAD
[email protected]

Published: October 6, 2007
Last Modified: October 6, 2007 at 02:13 AM

WASHINGTON — A Shell Oil executive who heads up exploration in the Americas said he’s been personally spending time on the North Slope, hoping to persuade borough officials and residents that the company’s exploratory efforts not only will be environmentally sound, but of economic benefit to the state.

Marvin Odum, a vice president with Shell, said Friday that the Dutch oil company is committed to its efforts in Alaska. And a federal court decision that prohibited Shell from exploratory drilling in the Beaufort Sea this summer is merely a temporary setback, he said.

The “luster” of Alaska hasn’t worn off, and neither has the company’s enthusiasm and interest in “keeping the pipeline full,” Odum said during a briefing with reporters in Washington, D.C.

“The fact that we’re still there, the fact that I’ve spent a lot of time personally there; it hasn’t worn off at all,” he said. “We’re 100 percent committed to moving forward.”

Native whale hunters, environmentalists and the North Slope Borough sued to stop the company’s exploratory efforts in Camden Bay this summer, saying they fear the risks to wildlife and the environment. The borough and environmentalists also fought the federal Environmental Protection Agency’s decision to issue air-pollution permits for two diesel-burning offshore drilling ships.

The federal Minerals Management Service estimates the drill site, known as Sivulliq, contains 100 million to 200 million barrels of oil. In its applications, the company told government officials it hopes to drill as many as four exploratory wells at the site, about 16 miles offshore. The Arctic National Wildlife Refuge, which is closed to oil drilling, is just east of Sivulliq.

DRILLING CONCERNS

Although exploratory wells have been drilled before, conservationists and residents said in their lawsuit that they believe federal regulators inadequately studied the potential risks. They worry that industrial noise and oil spills could disturb or harm endangered bowhead whales, polar bears, fish and birds that sustain the Inupiat subsistence culture.

They’re also concerned about whether Shell can adequately clean up oil spills in icy conditions, said Whit Sheard, who is based in Alaska for the San Francisco environmental group Pacific Environment. The organization is a party to the lawsuit.

“Our biggest concern and the major thrust of this lawsuit is that the federal government is not doing its job as stewards of our public resources,” Sheard said. “The government has given a green light to operations without doing a full environmental assessment, and the cultures that depend on the environment weren’t getting a fair shake in the planning process.”

But Odum said one of the reasons Shell remains committed to Alaska is that the company sees not only the business potential, but also the opportunity to “demonstrate how we can manage it right.”

WORK THIS WINTER

“We have a tremendous amount of arctic experience, in Norway, Canada, Russia and other places,” he said. “It gives us confidence that we know how to do this in the right way. We’re working directly with the North Slope Borough on what sort of things are important to them, and what they would like to see.”

For now, Shell’s exploratory fleet has been turned away.

Yet the company will continue with what Odum deemed “pioneering” seismic research technology this winter, when the area is iced over. The testing, which spreads receivers out across the ice, is similar to land-based testing technology. Company officials said they think it will be less harmful to conduct the testing in the winter.

Among the concerns from the borough is that underwater noise created by seismic testing will affect whale migratory patterns.

The parties will return to court in December.
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Find Erika Bolstad online at adn.com/contact/ebolstad or call her in Washington, D.C., at 202-383-6104.

http://www.adn.com/money/industries/oil/story/9358670p-9272321c.html

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