Tuesday, May 29, 2012

9th Circuit gives final approval to Shell exploration plan

Tim Bradner
Alaska Journal of Commerce

A federal appeals court upheld the government’s approval of an exploration plan filed by Shell to explore its outer continental shelf leases in the Arctic in 2012.

The unanimous May 25 decision was by a three-judge panel of the 9th Circuit Court of Appeals.

Greenpeace, the Sierra Club, the Wilderness Society and two Alaskan Inupiat groups had appealed the approval of the Beaufort Sea and Chukchi Sea drilling plans given by the Bureau of Ocean Energy Management last August.

The challengers had claimed that Shell's proposal for a well-capping stack and containment system in the event of an oil spill was incomplete and that it had failed to fully inform the government about its oil spill response plan.

Shell spokesman Curtis Smith said the company was expecting a favorable decision by the court.

“There are other appeals still pending, such as those of our air quality permits, but the favorable ruling on the exploration plan is a substantial boost for us,” Smith said.

A similar exploration plan by Shell had been before the same judges on the appeals court in 2010, and was approved.

Shell is now mobilizing its fleet to do exploration in both the Beaufort and Chukchi seas this summer. The drillship Noble Discoverer and the Kulluk, a conical, mobile drilling structure, are both in a Seattle shipyard undergoing final refitting and preparing to depart to Dutch Harbor in mid-June along with support vessels.

Smith said the air emissions systems for the Kulluk were upgraded in Seattle. The Kulluk is actually owned by Shell and is, interestingly, the only drilling unit owned by the company.

Similar upgrades to air emissions system of the Noble Discoverer were made in a Singapore shipyard, but in Seattle additional “winterizing” modifications, such as the addition of wind shields, are being done.

An oil spill response vessel and a second support ship have been in Valdez where crews are undergoing spill response training.

Plans are for all the vessels to be in Arctic waters in August to begin drilling, which must be completed by late fall, when ice moves into the exploration areas.

Environmental groups have also filed appeals to the 9th Circuit court of final government approvals of federal air quality permits for the drillships, but Smith said Shell expects those to all be approved as well.

The permits were issued by the U.S. Environmental Protection Agency and withstood appeals by environmental groups to the EPA’s internal Environmental Appeals Board.

Traditionally, courts defer to the executive branch in regulatory matters as long as the agency decisions were within the scope of law, and normal procedures were followed.

Read more: http://www.alaskajournal.com/Alaska-Journal-of-Commerce/May-Issue-4-2012/9th-Circuit-gives-final-approval-to-Shell-exploration-plan/#ixzz1wI9gEz4B