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Spill panel asks whether Shell Oil’s Arctic response plans are ‘realistic’

The Hill Newspaper
By Ben Geman – 10/06/10 02:29 PM ET

The presidential commission probing the BP oil spill is questioning whether Shell Oil’s response plan for a potential spill in Arctic waters off Alaska’s coast is “realistic.”

The finding could provide ammunition to environmental groups that oppose Shell’s plans to conduct exploratory drilling, which the Interior Department has put on hold.

The adequacy of Shell’s contingency plan — called the C-Plan — for the Chukchi Sea surfaced in a staff paper released Wednesday by the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling.

“Shell’s exploratory drilling C-Plan is currently the only formal industry proposal for contingency planning and oil spill response in the Arctic. While Shell’s plan acknowledges many of the challenges of spill response in the Arctic, questions remain as to whether its solutions to those challenges are realistic,” the staff paper states.

“For its final report, the Commission may want to consider the forthcoming analysis conducted by the Pew Environmental group in evaluating the Shell plan and the requirements for Arctic response plans generally,” it adds.

Plans by Shell and other companies to look for oil in icy Arctic waters are facing growing scrutiny in the wake of the BP oil spill, even though Shell is seeking permission to drill in far shallower waters than BP’s ill-fated Macondo well in the Gulf of Mexico.

Alaska Gov. Sean Parnell (R) in September sued Interior, alleging regulators are illegally blocking development, while Sen. Mark Begich (D-Alaska) — who supports the lawsuit — is pressing the White House to clarify its plans for making decisions about Arctic development.

The paper also says the bipartisan commission should explore regulatory standards that govern Arctic drilling and whether they need to be amended. It credits Shell’s efforts to exceed the requirements but notes other companies might not do so.

“The regulations set out requirements for spill response planning, such as the volume for the worst-case discharge scenario and the proximity to the well of spill response equipment. The Shell plan appears to go beyond these standards, but other drillers may not,” the paper notes.

The staff paper also says the commission should consider calling for increased Coast Guard capacity to respond to a potential Arctic spill.

“Because the Coast Guard has an admitted lack of response capacity in the Arctic, immediate responsibility would fall on industry and their oil spill response contactors. Shell, at least, accepts this responsibility,” the paper states.

The commission should mull whether increased Coast Guard capacity “should be a prerequisite for offshore activity,” it states.

The White House-created commission is exploring the “root causes” of the BP spill and offshore drilling policy reforms. It is slated to submit a final report to the White House in January. The draft “working paper” is meant to inform the commission’s report.

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