Shell ceases Alaska Arctic drilling, cites disappointing results from

Information for this article was contributed by Dan Joling of The Associated Press.

The announcement represents a big change of heart from Shell, which was counting on offshore drilling in Alaska to help it drive revenue.

But Shell, drilling to 6,800 feet about 80 miles offshore in the Chukchi Sea off Alaska’s northwest coast and supported by a 28-vessel flotilla, just didn’t find much.

“However”, he added, “this is a clearly disappointing exploration outcome for this part of the basin”. Environmentalists, however, had tried repeatedly to block the project and welcomed the news. Given that a 1-billion-barrel field is known as a supergiant, and that oil prices at the time were closing in on 0 a barrel, oil companies drooled over the prospects.

In afternoon trading in London, Shell’s share price was down 2.7 percent at 1,515 pence in a weak overall market.

Federal regulators are preparing to issue Arctic-specific exploratory drilling regulations, crafted in the aftermath of the Deepwater Horizon disaster in the Gulf of Mexico.

Greenpeace had vowed to fight Shell and urged Obama to stop the firm’s exploration activities in the area.

“Meaningful action to address climate change is nearly certainly going to mean we can’t keep looking for oil in remote and expensive places”, LeVine said.

Environmental groups oppose drilling in the Arctic due to the vulnerability of animals already struggling to survive because of melting sea ice, as well as risk that a spill could pose to the region. “For three years we faced them down, and the people won”, John Sauven, executive director at Greenpeace United Kingdom, told Reuters.

Through it all, Shell was nearly alone in its pursuit of the Arctic, drawn by billions of barrels of potential reserves. “Kayaktivists” blocked Shell oil rigs headed for the Arctic in Seattle and Portland.

Margaret Williams of the World Wildlife Fund in Anchorage, called the news stunning.

“There was always the knowledge with most people that this may work out for them-and it might not”, she said.

Noting the President’s trip, Susan Murray of the green group Oceana observed: “Shell’s announcement today allows the government to take a step back and apply careful planning, precaution and science to forge a sustainable future for the Arctic”. Shell planned to drill up to six wells within the next year, hoping Alaska’s Chukchi basin could be “a potential game-changer” in USA energy independence.

In 2012, Shell suspended exploration in the Arctic after a large drilling rig became unmoored and ran ashore.

A transition to production could have taken a decade or longer.

This year, one of Shell’s icebreakers, the Fennica, was on its way out of Dutch Harbor after anchoring in an area ships of its size usually do not.

Charles Ebinger, senior fellow for the Brookings Institution Energy Security and Climate Initiative said that areas like the Alaskan Arctic are one of the frontiers that need to be examined to be able to meet this demand. “We need them to evolve so that our children can thrive”.

In order for Arctic energy development to proceed, companies must contend with these challenges.

Another, the Noble Discoverer, was recently cited by the US Coast Guard for numerous safety and operational deficiencies.

Walker says he’s contacted the White House to set up meetings about the impact of Shell’s decision on the state.