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OIL AND GAS
Shell resumes offshore oil drilling in Arctic
by Staff Writers
Washington (AFP) July 31, 2015


SEC asked to review arctic oil exploration transparency
Washington (UPI) Jul 31, 2015 - U.S. congressional leaders said they had questions about the disclosure of risks facing companies like Royal Dutch Shell targeting arctic oil and gas reserves.

Ranking members of the House of Representatives Committees on Natural Resources and Financial Services issued a letter to the Securities and Exchange Commission seeking a review of corporate financial disclosures by oil and gas companies with offshore operations, particular in arctic waters.

When the federal government gave limited consent to Shell to start drilling operations off the coast of Alaska earlier this month, Rep. Raul Grijalva, D-Ariz., ranking member of the House natural resources committee, said Shell's campaign was "fruitless."

When issuing the letter to the SEC, Rep. Alan Lowethal, R-Calif., a member of the natural resources committee, said there were concerns about how transparent companies like Shell were about what's at stake with arctic campaigns.

"Full disclosure of risk is essential to good decision-making by the public and without it our markets cannot function properly," he said in a statement. "I am concerned that oil and gas companies may not be disclosing their full risk exposure to the public."

Shell's early efforts off the coast of Alaska were plagued by equipment issues. Recent federal permits for the company excluded drilling into oil-bearing zones because the company lacked a critical piece of safety equipment called a capping stack.

Despite a high-profile campaign from Greenpeace, the ship chartered to carry the capping stack, MV Fennica, is on its way to the drilling site after repairs in Oregon.

The Dutch supermajor said it was moving forward with offshore Alaska efforts that would address "the high bar that stakeholders and regulators expect of an arctic operator."

Few Republican voices have emerged in opposition to Shell's arctic campaign. In June testimony before the House, Erik Milito, director of exploration and production for the American Petroleum Institute, said exploiting arctic reserves should be a national priority.

Michael LeVine, a senior counsel on the Pacific region for advocacy group Oceana who testified alongside Milito in June, said in an emailed statement Shell's arctic ambitions should be a concern to investors and regulators alike.

"Full disclosure of the risks of oil and gas operations in the Arctic is essential to good decisions for companies, the government, and the public," he said. "The SEC has an important role to play in ensuring that all of the risks of oil and gas operations in the Arctic are adequately disclosed and evaluated."

Oil giant Shell has resumed offshore drilling operations in Alaskan waters, the company said Friday, after one of its icebreakers was delayed for nearly two days by protesters dangling from a bridge.

Greenpeace activists were suspended from a bridge and in kayaks in the water for more than 40 hours in an effort to block the Fennica icebreaker from traveling to the Transocean Polar Pioneer rig in the Arctic Ocean.

Shell said drilling operations resumed Thursday at 5:00 pm (0100 GMT Friday) at the "Burger J" prospect in the Chukchi Sea, off the northwest coast of Alaska.

It said work would continue after the 116-meter (380-foot) Fennica icebreaker arrived at the rig.

"In the days to come, the team aboard the Transocean Polar Pioneer will work to complete the top portion of the well in anticipation of drilling to total depth once the Fennica arrives on site," the company told AFP in a statement.

"We remain committed to operating safely and responsibly and adding to Shell's long history of exploration offshore Alaska."

Fennica set off Thursday after it was blocked by the activists, including those suspended from a bridge in hammock-like devices. Other protesters were stationed on the bridge while some floated in kayaks in the water.

A US judge on Thursday threatened to fine the protesters for every hour they continued to block the Shell icebreaker.

Later Thursday, all of the hanging protesters had evacuated the site, but Greenpeace said it would continue to fight Shell and urged US President Barack Obama to stop Shell's exploration activities in the region.

"The 13 #ShellNo climbers have come off the bridge. Now all eyes are on President Obama to save the Arctic," the organization said on Twitter.

In May, Obama authorized oil drilling in the Arctic, a decision that infuriated environmental groups.

Greenpeace denounced Obama, and urged people to sign an online petition to block offshore Arctic drilling on Thursday.

"It's not too late. But we need to make our voices heard now," the group said in a statement.

"Ask President Obama and the Department of the Interior to show climate leadership and protect the Arctic by rescinding Shell's Arctic drilling lease."

Obama has called US oil production an "important" source of energy in defense of his move to allow Shell to drill in the Alaskan Arctic.

It is not the first time Greenpeace activists have stood up against Shell. In mid-June, protesters in kayaks tried to block the departure of a giant Shell oil platform from Seattle and keep it from drilling in the Arctic.

It is the first time Shell has conducted exploratory drilling in the Arctic since 2012, after facing several equipment and weather delays.

Fennica was in Portland for repairs after suffering an accident in the Arctic that left a hole in its hull.


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