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Arctic oil: Shell seeks last-minute break on air pollution permit

By Kim MurphyJuly 13, 2012, 5:53 p.m.

SEATTLE — Only weeks before it is set to begin drilling exploratory oil wells in the Alaskan Arctic, Shell has asked the Environmental Protection Agency for a last-minute revision in its air emissions permits, conceding it has not been able to meet all of the rigorous standards required for the main generator on the drill bit for its Chukchi Sea drilling rig, the Discoverer.

In a filing with the EPA, the company said it was still able to meet overall ambient air quality and annual emissions standards. But it said it was having trouble meeting the requirements for nitrogen oxide and ammonia, despite having spent at least $30 million trying to outfit the diesel generators that will run the drilling equipment on the leased vessel with state-of-the-art technology previously untested on an offshore drilling rig.

“Shell was then and remains now committed to making every effort to meet the emission limits imposed by EPA,” the company said in its application, adding that its testing has “demonstrated compliance with a vast majority of limits.”

Air pollution controls have been an important point of controversy as drilling gets under way in the Arctic. Thousands of tons of pollution will be pumped into the region’s region’s relatively pristine air as a result of the new oil operations, though Shell has agreed to employ the best available technology to minimize them.

Conservation groups have filed repeated challenges to EPA approvals of air emissions permits. The company’s difficulty in winning EPA approvals in recent years has delayed the debut of offshore operations and prompted the Alaska congressional delegation to call for moving oversight of offshore air permits in the Arctic from the EPA to the Department of Interior.

Just how difficult it has been to comply with the stringent permit requirements was clear this week in the company’s application, which documented how Shell has spent millions of dollars acquiring new technology for the 514-foot Discoverer’s main drilling generator and engaged in the difficult task of installing it on old engines, installed far below deck.

When one $24-million system didn’t work as well as had been hoped, the company spent another $7 million installing another, according to the application. “This reflects an extraordinary level of effort, especially when one considers that the annual emissions from the diesel generators are on the order of 10 tons,” the company said in its filing.

The new equipment meets most of the permit conditions, but falls short on the standards for nitrogen oxide and ammonia emissions, the company reported. Shell is asking the EPA to amend those standards upwards, and is also seeking three other relatively minor permit adjustments, including limits set for one of the company’s newly designed oil spill response vessels.

“Overall, we are still in compliance with emissions for the Discoverer and there is consensus that no current generator on the market — even when outfitted with best available control technology — can meet the current standard,” Shell spokesman Curtis Smith said in an email to the Los Angeles Times.

“We don’t anticipate this being an issue.”

EPA officials said they did not expect the permit issues to be a serious impediment to Shell’s drilling plans, which are scheduled to get underway in early August.

“We are working with the company and are confident that using the tools we have under the Clean Air Act, we can protect air quality while providing the EPA approvals required for Shell to operate this summer,” the agency said in a statement.

Critics of offshore drilling in the Arctic said the new application reflects a substantial increase in emissions over what originally was promised: a threefold increase in nitrogen oxide, according to the Center for Biological Diversity, which along with other organizations has challenged air permits for Arctic drilling.

“What I find interesting is that what they’re saying is they’ve now done these tests, and they’ve found that their earlier predictions that were used to base the permit on weren’t accurate,” said Emilie Surrusco of the Alaska Wilderness League. “So the question becomes, why are you bringing this up now, when you’re supposed to start drilling in a matter of days? And what is EPA supposed to do about it?”


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