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Reuters: Shell cites higher commodity prices in Alaska bid

Wed Feb 13, 2008 10:06pm GMT 

HOUSTON, Feb 13 (Reuters) – A top Royal Dutch Shell (RDSa.L: Quote, Profile, Research) executive said higher commodity prices and new technology were behind the company’s huge bid to explore in the Chukchi Sea off Alaska’s northwestern coast.

“Commodity prices are in a much different place than they were when we were there many, many years ago, and more importantly, technology (has developed),” said Linda Cook, executive director for gas and power at Shell. “We can now have more confidence about our ability to explore and develop and operate in what will be difficult conditions,” she said.

Last week, the company bid $105.3 million for a single exploration block there, the highest dollar amount offered for a single tract in an offshore lease sale, the Minerals Management Service said.

Shell, the most active bidder in the record-breaking sale, offered $2.1 billion in total high bids for 275 tracts, according to preliminary results released by the MMS.

The company won back exploration rights to Chukchi territory it had explored in the late 1980s but later abandoned.

“We drilled some years ago in the Chukchi, so we have some information from that previous campaign,” Cook said, speaking to reporters at the CERA energy conference. “We did our homework.”

She said Shell views Alaska “as one of the remaining potentially large prospective basins around the world for oil and gas exploration.”

(Reporting by Michael Erman, editing by Matthew Lewis)

© Reuters 2008 All rights reserved.

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