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Shell still in litigation regarding its plans to drill on the Outer Continental Shelf


Top 10 stories of 2009: Argument over drilling on the OCS

by Ted Land
Monday, December 21, 2009

ANCHORAGE, Alaska — It seems like every few weeks there’s been a new twist in what has become a long, litigated process.

The Outer Continental Shelf in question is the area 20-70 miles off Alaska’s north and west coasts, where offshore drilling proponents say there is potentially 25 billion barrels of oil on tap and another 130 trillion cubic feet of gas.

This year, the process of tapping these resources began with senate confirmation of the man who will oversee activity on the OCS.

President Barack Obama chose Colorado Sen. Ken Salazar to be his secretary of the interior.

“I am glad to say that Sen. Salazar has had experience on all sides of the public lands debate: As a rancher and as both Colorado’s attorney general and head of the Department of Natural Resources,” Alaska Sen. Lisa Murkowski said of his appointment.

Salazar was confirmed in January and promised to visit Alaska as he shaped the nation’s policy on oil and gas drilling.

Almost immediately, he put OCS drilling on hold, saying he needed more input from communities affected by exploration.

It was an abrupt departure from Bush administration policies, which accelerated drilling plans in its final days.

“What this shows is a dramatic change from the last eight years where you had a one-road highway to energy independence which was drill, drill, drill,” Salazar said.

“The conservation community sees a place for oil and gas development but it was so much, so fast, so extreme that people felt like it was time to slow down,” said Eleanor Huffines with the Alaska Wilderness Society.

In March, Northern Economics released a study on the impact of drilling.

It was paid for by Shell Oil, the largest lease holder in the Beaufort and Chukchi seas, and showed that OCS development would employ 35,000 people annually over the next 50 years.

The North Slope Borough questioned the reality of those numbers.

“The past year’s experience with the price of oil would suggest that making 50-year projections is as much about guess work as they are about science,” David Harding, a spokesperson for the Borough.

Nonetheless, it became part of the PR blitz which bombarded Secretary Salazar in April on his first visit to the state.

He landed in Dillingham, where he asked for a show of hands of those who oppose development. The number of hands raised was significant.

“We believe that you don’t drill everywhere, that there are treasured landscapes that need to be protected, but we also recognize that the reality is that we are dependent on fossil fuels, coal oil and gas,” Salazar said.

Demonstrators on both sides of the argument greeted Salazar the next day in Anchorage.

Inside the Dena’ina center, Salazar just listened.

He returned to Washington to draft a comprehensive energy plan for the country.

Meanwhile, the courts were taking action.

In late April a Washington, DC court of appeals said the federal lease program did not conduct adequate environmental studies. The court ordered all lease sales to a halt. Shell feared their $2.1 billion in leases in the Chukchi Sea would be taken away.

In August, however, came a victory for shell’s $85 million dollars in leases in the Beaufort Sea.

The Ninth Circuit Court of Appeals in San Francisco rejected demands for a new environmental impact statement. The oil company could now move forward with plans to start exploring.

“Our 2010 plan of exploration was crafted as a direct result of feedback we got from North Slope stake holders that we were moving too fast, that it was too much and too soon. So the new plan reflects that. It’s one year, it’s one rig, and it’s half the number of wells we had previously planned to drill,” said Curtis Smith with Shell.

In September Gov. Parnell traveled to the nation’s capital to visit Salazar.

“We’re gonna stay in full court press mode for as long as it takes to open the OCS,” Parnell said.

The secretary said he’s in no rush to make a decision on offshore drilling.

But last month the Department of the Interior Minerals Management Service approved Shell’s plan to start exploring in the Beaufort Sea.

Channel 2 News visited the community of Barrow during its fall whale hunt to find out how residents there feel about development in the waters they depend on for food.

“These folks have been whaling for thousands of years and they’re not going to have an oil company come in and disrupt that, and they shouldn’t,” said Mike Schults, a City Councilman in the community.

Earlier this month the Interior Department approved Shell’s plans to start exploring in the Chukchi Sea.

Shell says it will drill three exploratory wells next year.

“This is still not door open we’re drilling in 2010, but this is a really important first step,” said Shell spokesman Pete Slaiby.

The company still needs an EPA emissions permit for its rig, but after a big year of news, oil companies and residents are watching closely for what happens next.

Shell is still in litigation regarding its five-year plan to drill on the Outer Continental Shelf.

Friday Attorney General Dan Sullivan filed a motion in the Ninth Circuit Court of Appeals to uphold a federal decision allowing Shell to proceed with its plans to drill.

The Alaska Eskimo Whaling Commission and the Inupiat Community of the Arctic Slope are challenging that decision from October, which allows Shell to start exploring in the Beaufort Sea.

The North Slope Borough has been a part of legal action against the oil industry in the past, but this time the borough is not. It says it’s satisfied with Shell’s plans to scale back drilling from its original plans.

Contact Ted Land at [email protected]

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