Spill Analysis Planned for Alaskan Offshore Drilling

Source:

"Drilling has been held up by court challenges and a lack of permits."

Federal officials will study how a "very large oil spill" would affect the ocean off Alaska's northwest coast as part of a court-ordered environmental review for a 2008 offshore petroleum lease sale that garnered billions of dollars for federal coffers.

The decision by the Bureau of Ocean Energy Management, Regulation and Enforcement could further delay company drilling plans and potentially affect thousands of jobs, future energy security and the economic stimulus that would result from offshore development, said Curtis Smith, a spokesman for Shell Oil, the major lease holder in the Chukchi Sea.

The Chukchi lease sale in February 2008 brought in nearly $2.7 billion, including $2.1 billion from a subsidiary of Shell.

No exploratory wells have been drilled. Drilling has been held up by court challenges and a lack of permits, frustrating company officials and the state of Alaska, whose economic future depends on finding additional sources of oil for the trans-Alaska pipeline.

But U.S. District Court Judge Ralph Beistline of Anchorage in July ruled that the federal government failed to follow environmental law before it sold the leases in the Chukchi, which is covered much of the year by ice and is home to polar bears, walrus, ice seals and endangered whales.

Beistline ordered the Interior Department to analyze the environmental impact of natural gas development and determine whether environmental information it acknowledged was missing was essential for the sale to go forward.

Related Articles

Get Our Streetwise Reports Newsletter Free

A valid email address is required to subscribe