Statoil delays Arctic offshore drilling

Statoil has delayed its first exploration drilling in the Chukchi Sea until at least 2015 because of continued regulatory uncertainties facing Shell’s efforts to drill, a Statoil official in Houston said Sept. 7.

This is a delay of one year from the previous plan. Statoil had been planning to drill its first well in 2014.

“In light of the significant uncertainty regarding Alaska offshore exploration, we have decided to take the prudent step of observing the outcome of Shell’s efforts before finalizing our own exploration decision timeframe,” Statoil spokesman Jim Schwartz said in a statement.

“We believe it is important to observe the timing and outcomes of obtaining all necessary permits, securing regulatory approvals and demonstrating that exploration operations can be reliably and cost-effectively conducted in this dynamic and challenging environment.”

Shell’s efforts to drill its first exploration wells in the Chukchi and Beaufort seas have been stymied by a number of factors including lengthy permitting procedures and, more recently, weather, ice and delays in certification of a spill response barge.

Schwartz said Statoil has made no firm decisions on drilling even in 2015, but would continue scientific research that is underway in a joint program with Shell and ConocoPhillips as well as other preparations and work with local communities.

ConocoPhillips has been planning to drill its first Chukchi Sea exploration well in 2014 and has made no change to the plan, company spokeswoman Natalie Lowman said.

Shell now has two drill vessels in the Arctic. The drillship Noble Discoverer began work on one well at the Burger prospect in the Chukchi Sea but had to cease operations due to a large approaching ice flow. The second vessel, the Kulluk, is in the Beaufort Sea waiting for Inupiat whalers to complete their fall subsistence whale hunt.

The U.S. Interior Department gave Shell permission for drilling only to the 1,400-foot level in the Chukchi Sea until a specialized spill barge is on the scene. The barge has not yet completed final inspections and certifications.

Meanwhile, there has been no response yet from the U.S. Interior Department to Shell’s request for a two-week extension to a Sept. 24 for a halt to drilling activities in hydrocarbon zones. Under the rule Shell can continue testing any well drilled to a hydrocarbon zone before Sept. 24, however. It can also do work on other wells including “top-hole” drilling to 1,400 feet and setting of casing on wells that can be completed next year.

11/11/2016 - 12:04pm