Arctic drilling plans will be suspended

WASHINGTON – The Obama administration today will suspend planned exploratory oil drilling in the Arctic Ocean off Alaska until at least 2011, a casualty of the Gulf of Mexico oil spill.

The suspension will be part of a report that Interior Secretary Ken Salazar will give to President Barack Obama, who’s likely to address the suspension as well as other proposals stemming from Salazar’s report, at a White House news conference today.

The move will stop Shell from drilling five wells in the Chukchi and Beaufort seas off northern Alaska weeks before it had hoped to start work, an administration official told McClatchy Newspapers.

The move will stop for now a controversial expansion of oil drilling in a part of the world that could hold vast stores of oil and natural gas, but which environmentalists warn would come at great risk.

Despite a late appeal from Shell that it would employ new safety measures in the wake of the Gulf spill, Salazar was unconvinced that the exploratory drilling even in the much shallower waters of the Arctic would be safe.

“He is suspending proposed exploratory drilling in the Arctic,” an administration official said on condition of anonymity to talk before Salazar’s report is officially released today. “He will not consider applications for permits to drill in the Arctic until 2011 because of the need for further information-gathering, evaluation of proposed drilling technology, and evaluation of oil-spill response capabilities for Arctic waters.”

Shell, which paid $2.1 billion in 2008 for the leases, had planned to start exploratory drilling in June or July.

The federal Minerals Management Service estimates that the two seas hold up to 19 billion barrels of oil and up to 74 trillion cubic feet of natural gas, a combined resource comparable to the onshore fields of Alaska’s North Slope.

In a post-Gulf spill pitch to keep its work on track, Shell stressed that the Arctic seas are shallower than the Gulf, that drilling wouldn’t have to probe as far into the earth, and that the equipment wouldn’t be under as much pressure – or risk of failure.

In the Chukchi Sea, Shell said, it would be drilling in 150 feet of water to a depth of 7,000 to 8,000 feet. In the Beaufort, which is also 150 feet deep, it would be drilling to a depth of 10,200 feet.

The Deepwater Horizon rig in the gulf was working through 5,000 feet of water, and then drilling to a depth of 18,000 feet.

On May 14, Shell sent a five-page letter to the Minerals Management Service spelling out how it plans to drill in Arctic waters, how it would prevent a spill, and how it would respond starting within an hour if a spill occurred.

“Shell is committed to undertaking a safe and environmentally responsible exploration program in the Chukchi Sea and Beaufort Sea in 2010,” Shell Oil Co. President Marvin E. Odum told the MMS.

“I am confident that we are ready to conduct the 2010 Arctic exploratory program safely and, I want to be clear, the accountability for this program rests with Shell.”

Those plans included nine new steps the oil giant has added since the Gulf of Mexico spill, including a policy of testing underwater equipment called a blowout preventer every seven days instead of every 14 days and development of a system to allow a remote-operated vehicle to turn the blowout preventer back on.