Shell might drill three exploratory wells in Alaska's Beaufort and Chukchi seas this summer, rather than the five planned, if unusually late ice cover delays the start of drilling into mid-August, company President Marvin Odum said Thursday in an interview.
Odum said during a taping of the "Platts Energy Week" television show that the company nevertheless remains confident that the closely watched Arctic exploration would go ahead this summer -- the first drilling in the remote area in three decades.
"It's a little ironic, isn't it, that this is the year it looks like we'll finally move forward with the drilling process, and what we find through our analysis is there's more ice in the Arctic this year than there has been in the last decade," Odum said during the interview. "That's just Mother Nature.
"It runs through these cycles; we just happen to be in a heavy ice year. That potentially delays the start of what we would call the drilling season by as much as a couple of weeks," he said.
Shell plans to drill three wells in the Chukchi Sea and two in the Beaufort Sea. The Kulluck and Noble Discoverer drillships, which were refurbished in Seattle, and a well capping stack built in Portland are expected to head to the remote region within weeks.
Before securing drilling permits, the company must perform live drills with the equipment in similar water depths and pass inspections of the oil spill response systems.
"We are confident we'll pass those tests," Odum said.
Odum said drilling would most likely start in the first two weeks of August. But if heavy ice persists and pushes drilling to the middle of August, as a worst-case scenario, the company could only realistically drill two Chukchi wells and one Beaufort well.
"Again, that's just part of the uncertainty that we deal with when we enter an area like this," he said. "We're fully prepared for that. It's not completely unexpected. So it's not as far as we'd like to get, but it will still be suitable."
Of the five wells ever drilled in the Chukchi, Shell performed four of them.
Odum said what differentiates the 1980s exploration and this summer's program is modern three-dimensional seismic surveying that hopefully provides a more reliable map of the fossil fuels trapped below the seabed.
"We have done all of this before," he said. "We've drilled into some of these reservoirs before. What we need to do is drill into them in exactly the right places."
The project has attracted considerable attention from environmental groups concerned about possible well blowouts and oil spills in the remote and delicate area.
Odum said he remains confident in the company's multiple redundancies for safety and in oil spill response systems that would deploy within an hour of any accident.
"Nobody's more concerned about it than us," he said. "The first question and the issue that we had to get over was: internally, were we absolutely sure we could do this in a safe way, in a way that would protect the environment? And that's where we are."
"Platts Energy Week" airs Sundays in Washington at 8 a.m. on WUSA and in Houston at 4 p.m. (both local times) on the PBS channel KUHT. The show is also available online at www.plattsenergyweektv.com.
