Arctic drilling still a no-go, despite judge's moratorium ruling

McClatchy NewspapersJune 22, 2010 

WASHINGTON — Tuesday's decision by a federal judge in Louisiana to overturn a six-month moratorium on deep water offshore drilling in the Gulf of Mexico will have no effect on drilling in Alaska's Arctic, the Interior Department said Tuesday.

The White House announced the Gulf moratorium in May after a 30-day review into what caused the deadly explosion that continues to spew upwards of 60,000 barrels of oil into Gulf waters each day. The administration halted approval of any new permits for deep water drilling and suspended drilling of 33 exploratory wells in the Gulf of Mexico, a move that prompted some producers there to sue the federal government.

At the same time the White House announced the deep water moratorium, it also announced the Interior Department wouldn't consider applications for permits to drill in the Arctic until 2011. Interior Secretary Ken Salazar announced they would suspend Arctic exploration until they gathered more information about the region, evaluated the proposed drilling technology and looked more closely at oil-spill response capabilities for Arctic waters.

Shell Oil, which was set to begin drilling several exploratory wells in the Arctic this summer, argued that because its program is in shallower waters and not as risky as the deepwater drilling in the Gulf of Mexico.

Tuesday's court decision in Louisiana shows “the moratorium was overreaching,” said Sen. Mark Begich, D-Alaska, and should serve as a "shot across the bow" to the Obama Administration, he said.

“Companies demonstrating solid exploration and development plans and oil spill response plans should be able to develop our nation’s abundant oil,” he said. “Lifting a ban on deepwater activity, which carries greater risk than low-pressure, shallow-water development like in Alaska, hopefully will get responsible exploratory drilling planned by Shell in Alaska’s Arctic waters back on track soon.”

Begich was echoed by Alaska Gov. Sean Parnell. “We hope this sends a clear message to federal agencies to grant the permits that Shell will need to drill in the Outer Continental Shelf in 2011,” the Republican governor said.

Although Shell said last month it understood the rationale behind the Arctic decision, the company’s top North American executive, Marvin Odum, and other oil company CEOs who testified last week on Capitol Hill also said they are concerned about the effect of the deep water moratorium on the Gulf of Mexico economy.

Tuesday, Shell’s Alaska spokesman, Curtis Smith, called the ruling on the Gulf moratorium “an important step in potentially returning thousands of oil service workers to their jobs.”

“Unfortunately, it does not change the fate of the nearly 800 workers who were slated to work as a part of Shell's 2010 Alaska drilling program," Smith said.

Robert Dillon, a spokesman for Sen. Lisa Murkowski, R-Alaska, said she would call for the court decision to extend to the Shell’s exploratory drilling in Alaska.

The decision “sends a clear message that the law will not be manipulated for political gain,” said Rep. Don Young, R-Alaska.

“I would have liked to have seen the Beaufort and Chukchi also re-evaluated,” he said. “These oil leases provide jobs and revenue as well as much needed fuel to a country that is currently beholden to foreign countries for its energy needs.”

The White House has promised an immediate appeal of the court’s decision.

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