Shells arctic oil response plan: intensive efforts balance risk.

• Author: Stricker, Julie
• Position: SPECIAL SECTION: Environmental Services

As Royal Dutch Shell's drilling rigs make their way up Alaska's coast to oil leases in the Chukchi Sea, the oil giant and its drilling procedures in the Arctic are being scrutinized closely.

The twenty-five-ship exploration flotilla includes two drill ships, the semi-submersible Polar Pioneer, and the Noble Discoverer. In June, the Polar Pioneer was headed for the staging area at Dutch Harbor, while the Discoverer was still in Washington. Shell estimates the ships would arrive in the Arctic in mid-July, when the drill sites were expected to be clear of pack ice. The first, called the Burger prospect, is about seventy miles northwest of Wainwright.

Intensive Effort

The oil giant has been operating in Arctic waters for decades and says it takes great care in operating safely. "The goal of zero spills is one of our highest priorities--along with the safety of personnel and an intensive effort to recognize the concerns of the people who live near and depend upon the resources of the Chukchi Sea," the company states.

According to the US Geological Survey, Alaska's Outer Continental Shelf may hold more than 26 billion barrels of oil. Starting in July, Shell planned to drill as many as six wells over the next two summers in the Chukchi Sea north of Alaska to confirm if the oil is economically recoverable. It spent $2.1 billion for the leases in 2008.

It's an operation that involves not only Shell, which has eighty-seven thousand employees in seventy countries, but dozens of state and federal agencies, a cooperative agreement with other North Slope oil producers and operators, as well as regional and village Alaska Native corporations.

"We partner with communities across Alaska by engaging with stakeholders to understand and address their concerns," the company says. "Partnering with communities is the most valuable role Shell can take."

Shell has been involved in the Alaska petroleum industry since 1918. It has held more than six hundred meetings with Alaska stakeholders and communities since 2006.

Balancing the Risk

In July 2014, ASRC (Arctic Slope Regional Corporation) and six North Slope village corporations created a company, Arctic Inupiat Offshore, that allows them to acquire an interest in Shell's Chukchi Sea operations. The six communities represented are Atqasuk, Kaktovik, Anaktuvuk Pass, Wainwright, Point Hope, and Barrow. Rex Rock Sr., president and CEO of ASRC, will serve as president of Arctic Inupiat Offshore.

"Our region has always...