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Oil and Arctic Ocean Make A Highly Troublesome Mix
Oil and Arctic Ocean Make A Highly Troublesome Mix
As the U.S. and Russia take the first halting steps to drill for oil and gas in the Arctic Ocean, experts say the harsh climate, icy seas, and lack of any infrastructure means a sizeable oil spill would be very difficult to clean up and could cause extensive environmental damage.
Ideally, the Canadian Coast Guard would have been on hand to deal with the situation. But the icebreaker it routinely dispatches to the Beaufort Sea had gone back to Vancouver for the winter. It would have taken a week for it to return.
In the days that followed, powerful currents swept the barge into Alaskan waters. The U.S. Coast Guard couldn’t do anything because its one operating icebreaker was stationed in Antarctica at the time. Canadian and U.S. officials thought the barge would most likely be locked in the ice, or crushed by ice and sink. It continued to drift, however, and when satellite observers checked last month the barge was about 40 miles off Russia’s Chukchi Peninsula. Russian attempts to find the barge have been hampered, likely to due to bad weather.
As potential oil spills go, the barge incident is an extremely minor one. But experts say that the errant barge should be a wake-up call for Arctic nations like the United States, Canada, Russia, Denmark, and Norway that are poised to ramp up shipping, as well as oil and gas drilling, in the Arctic.
…click on the above link to read the rest of the article…
We May Not See Arctic Oil For Decades
We May Not See Arctic Oil For Decades
Shell’s Arctic campaign this year will be pivotal. If the company cannot find large reserves of oil, it will likely set back Arctic oil development for a generation.
The Financial Times reported that Royal Dutch Shell will not see Arctic oil come online anytime soon, even in the best of scenarios. Even Shell officials think that the oil major will not be able to see Arctic oil hit the market until sometime in the 2030s.
Related: Shell Approval May Trigger Resource Race In The Arctic
There are a few reasons for this. Finding and developing offshore oil can typically take around a decade. First there is a long lead time before any drills hit the waters – analyzing data, purchasing acreage, planning, doing seismic surveys, getting permits, moving equipment into place, and finally deploying rigs. Shell first started buying up Arctic leases in 2007. After years of preparation (and huge setbacks), Shell has done most of this pre-drilling work.
Even then, once the rigs ply the icy waters, there are many years ahead before oil begins flowing. Shell has to drill test wells, analyze data, and drill more wells.
But the Arctic also presents some unique challenges not found anywhere else. First is the short drilling season. Shell wouldn’t be able to operate year round, and could only make headway a few months out of the year during the summer. Perhaps more importantly is the remote location. Without adequate infrastructure Shell would have to do a lot of building to make Arctic oil viable. That would include pipelines, processing facilities, roads, and more. The Gulf of Mexico has all of this stuff in place, which reduces the cost and risk of drilling, but the Arctic is uncharted territory.
…click on the above link to read the rest of the article…
Shell Approval May Trigger Resource Race In The Arctic
Shell Approval May Trigger Resource Race In The Arctic
In a few short months Shell will (re)enter the Chukchi Sea. The oil and gas major still awaits approval from a number of state and federal agencies, but in early May the company received the consent of the Obama administration to explore the remote Arctic sea 70 miles off the coast of Alaska.
Source: Nicolas Rapp, Fortune
If it sounds familiar, that’s because it is. Shell was in the Chukchi and Beaufort Seas for much of 2012 – a stint that ended with more headaches than drilling. Following some high-profile failures with its Noble Discoverer and Kulluk rigs, Shell put its Arctic operations on pause in early 2013. Amid slumping profits, the group called off its 2014 plans to resume. Today, the economic indicators are not much better – Shell lost $1.1 billion in the Americas in the first quarter of 2015 – but the company is committed to moving forward.
Related: Oil Prices Will Fall: A Lesson In Gravity
One of the richest sedimentary basins in the world, the Arctic Alaska Petroleum Province is estimated to hold approximately 28 billion barrels of technically recoverable oil and 122 trillion cubic feet of non-associated gas spread across Alaska’s continental shelf and rift shoulder.
For Shell in particular, it expects the Arctic to be its biggest source of crude oil globally within the next 20 years. Estimates vary, but the Bureau of Ocean Energy Management calculates the hurdle, or breakeven, price to be roughly $38 in the Chukchi Sea. With a profit margin of around 39 percent – probably generous – Shell could be earning $1 billion or more in annual profits for each 100,000 barrels produced per day at prices not much higher than today’s.
…click on the above link to read the rest of the article…
Fight Over Shell’s Arctic Drilling Escalates As Polar Pioneer Arrives and #ShellNo “Paddle in Seattle” Begins
Check back often as I’ll be updating this post throughout the day with photos and updates.
Here we go. Shell’s Polar Pioneer drilling rig is making its way through Puget Sound and will arrive later this afternoon at Terminal 5 in the Port of Seattle. You can watch the journey in real time if you want to follow along.
I’ll be chasing it from the bluffs and city parks near my house and then eventually plan to hop in my kayak down near T5 to witness the “unwelcome” party hosted by kayaktivists who’ve come from around the region and the world for the “Paddle in Seattle” to challenge Shell’s Arctic drilling plans this week and beyond. Then I plan to head back up to Golden Gardens park this evening for the Celebrating and Protecting the Salish Sea event featuring speakers from the host Lummi Nation and other local tribes.
Please add questions or suggestions in the comments section below and I’ll try to answer asap. Also keep an eye on the DeSmogBlog Twitter and Facebook for updates there, as well as Meerkat which I’ve just installed to tweet live video feed at opportune moments.
Timeline of updates (most recent first):
4:18pm PST Seattle is not cool with this new addition to the skyline.
2:35pm PST Well that was an unexpected and sobering surprise… I arrived at Carkeek Park to film the Polar Pioneer. It’s as massive and jaw-dropping in person as others have told me. Just as I was beginning to film, I noticed a train coming north around the bend and thought to myself ‘wouldn’t it be oddly poetic if that’s an oil train?’ ….. yup, it was.
…click on the above link to read the rest of the article…
Shell clears major hurdle for Arctic drilling
Exploration plan calls for 2 ships to drill up to 6 wells northwest of Wainwright, Alaska
Just days ahead of a planned protest of Royal Dutch Shell’s Arctic drilling program in Seattle, the company on Monday cleared a major bureaucratic hurdle to drill off Alaska’s northwestern coast.
The Bureau of Ocean Energy Management approved the multi-year exploration plan in the Chukchi Sea for Shell after reviewing thousands of comments from the public, Alaska Native organizations and state and federal agencies.
“We have taken a thoughtful approach to carefully considering potential exploration in the Chukchi Sea, recognizing the significant environmental, social and ecological resources in the region and establishing high standards for the protection of this critical ecosystem, our Arctic communities, and the subsistence needs and cultural traditions of Alaska Natives,” the agency’s director, Abigail Ross Hopper, said in a statement. “As we move forward, any offshore exploratory activities will continue to be subject to rigorous safety standards.”
Before Shell can begin drilling this summer, the company must still obtain other permits from state and federal agencies, including one to drill from the Bureau of Safety and Environmental Enforcement and government opinions that find Shell can comply with terms and conditions of the Endangered Species Act.
Shell spokesman Curtis Smith said the approval “is an important milestone and signals the confidence regulators have in our plan. However, before operations can begin this summer, it’s imperative that the remainder of our permits be practical, and delivered in a timely manner.
“In the meantime, we will continue to test and prepare our contractors, assets and contingency plans against the high bar stakeholders and regulators expect of an Arctic operator,” Smith said in an email to The Associated Press.
…click on the above link to read the rest of the article…
Russia To Power Arctic Drilling With Floating Nuclear Reactors
Russia To Power Arctic Drilling With Floating Nuclear Reactors
It would sit in the icy waters of the Arctic, and provide a constant supply of electricity to a massive rig drilling for oil. They could be mass produced, potentially cutting the cost of drilling projects. The twist? The electricity on these floating power plants would come from a nuclear reactor.
Russia is looking to deploy a floating nuclear reactor that could help power ports, industries, and also offshore oil and gas drilling in the Arctic. In what sounds like a horrible nightmare for environmentalists, floating nuclear reactors could help produce more oil in the Arctic.
Russia’s reactor, called the Akademik Lomonosov, will be about the length of one and a half football fields, and will have the capacity to produce 70 megawatts of electricity. It is not self-propelled, but future mobile reactors will be. Russia plans on mass producing them once the Akademik Lomonosov proves itself. The small floating reactors will be on icebreakers, so they will be able to navigate icy Arctic waters.
Construction began on the Akademik Lomonosov in 2007, but has suffered delays. But Russia’s Deputy Prime Minister Dmitry Rogozin said during a recent trip to the Arctic that Russia hopes to have a floating nuclear reactor running by October 2016. It will provide power to the Arctic town of Pevek in the East Siberian Sea. “It is basically an atomic reactor that can be docked to coastal infrastructure, and it will provide energy through a cable to any Arctic city,” Rogozin said.
According to Russia’s state-owned nuclear firm Rosatom, at least 15 countries, including China, Algeria, Indonesia, Malaysia and Argentina, are interested in deploying floating nuclear reactors as well. In fact, last year, during Russian President Vladimir Putin’s visit to Shanghai, Russia and China signed an agreement to cooperate on building a floating nuclear power plant.
…click on the above link to read the rest of the article…
U.S. To Lead A Fractured Arctic Council For The Next Two Years
U.S. To Lead A Fractured Arctic Council For The Next Two Years
The United States is set to take over the two-year chairmanship of the Arctic Council, and although there is a lot of uncertainty over how the U.S. will wield its influence, it will be taking the helm for a period of time that could see much more activity north of the Arctic Circle.
The Arctic Council is an international forum consisting of the eight nations that have territory in the Arctic – Canada, the U.S., Denmark (Greenland), Finland, Iceland, Norway, Sweden, and Russia. Up until recently it has been held up as a model of international cooperation. The members worked together on disaster response and environmental stewardship, leaving politics out of the council, all in the name of peace.
But the war in Ukraine has injected tension into the Council, creating conflict where it once didn’t exist. Canadian officials lambasted Russia’s involvement in Ukraine during its two-year tenure (2013-2015), using its platform as Council Chair. With western sanctions on top Russian officials, in February Canadacancelled the Arctic Showcase event in Ottawa that was supposed to be held on April 23 because it did not want sanctioned Russian officials to attend.
Related: BG Deal May Leave Shell’s Arctic Ambitions In Limbo
Russia has retaliated. Russia’s Foreign Minister Sergei Lavrov has attended every meeting since 2004 but chose to sit this one out in protest. Deputy Prime Minister Dmitri Rogozin, who has been targeted by western sanctions, visited Svalbard in mid-April, an archipelago that belongs to Norway. Norway protested his visit, and it was seen as a provocation ahead of the Arctic Council summit in Canada. Russia has also stepped up air patrols along its border with Norway in recent months, aggressive moves that have increased since its conflict with the West over Ukraine erupted in 2014.
…click on the above link to read the rest of the article…
What On Earth Are We Doing Looking For Oil In The Arctic?
What On Earth Are We Doing Looking For Oil In The Arctic?
Shell is back in; Statoil is pensive, but eager; and Russia is pushing ahead. Low prices have stunted exploration, but the Arctic is still a hotbed (read: marginally warm-bed) of activity. With so much to lose in the fragile and costly environment, why are we there?
One – albeit simple – answer numbers around 90 billion or 1,670 trillion depending on your business. The United States Geological Survey estimates that the area above the Arctic Circle holds 90 billion barrels (bbl) of undiscovered, technically recoverable oil and 1,670 trillion cubic feet of technically recoverable natural gas. That’s good for 13 percent of the undiscovered oil and 30 percent of the undiscovered natural gas in the world. Still, it’s not easily accessible – or easy to market – with most of the hydrocarbons occurring under the inhospitable and often frozen Arctic seas.
Another – more hopeful – answer involves the belief that the Arctic offers some semblance of a path toward energy independence. More specifically, for the largest consumer of all, the United States. US Arctic production began in earnest in the mid 70s following the ’73-74 oil embargo by the Organization of Arab Petroleum Exporting Countries, which sent prices up over 75 percent. Project Independence, as the Nixon Administration designed it, aimed to promote domestic energy independence, including the Trans-Alaska Pipeline System. Ultimately, the efficiency and production initiatives sent oil imports tumbling more than 50 percent by 1985.
Related: Arctic Oil On Life Support
Today, US shale has revived the nation’s hope of energy independence – no matter how off base it may be. Still, the Arctic’s role in furthering this goal is yet to be determined. Its oil-to-gas ratio – approximately 3:1 in favor of gas – limits any widespread appeal. Moreover, the Obama administration has been hesitant to expand leasing opportunities, instead favoring the Atlantic coast and Gulf of Mexico.
…click on the above link to read the rest of the article…
Arctic Oil On Life Support
Arctic Oil On Life Support
Oil companies have eyed the Arctic for years. With an estimated 90 billion barrels of oil lying north of the Arctic Circle, the circumpolar north is arguably the last corner of the globe that is still almost entirely unexplored.
As drilling technology advances, conventional oil reserves become harder to find, and climate change contributes to melting sea ice, the Arctic has moved up on the list of priorities in oil company board rooms.
That had companies moving north – Royal Dutch Shell off the coast of Alaska, Statoil in the Norwegian Arctic, and ExxonMobil in conjunction with Russia’s Rosneft in the Russian far north.
But achieving the goals of tapping the extensive oil reserves in the Arctic has been much harder than previously thought. Shell’s mishaps have been well-documented. The Anglo-Dutch company failed to achieve permits on time, had its drill ships run aground, and saw its oil spill containment dome “crushed like a beer can” during testing. That delayed drilling for several consecutive years.
…click on the above link to read the rest of the article…
Oil Industry Withdraws From High Cost Areas
Oil Industry Withdraws From High Cost Areas
The oil industry is pulling back from some marginal areas of operation, slashing jobs and spending, and retrenching in the face of the ongoing slump in oil markets.
Signs of a shrinking footprint are beginning to pop up across the globe. Norway’s Statoil has let three of its exploration licenses expire in Greenland, an acknowledgement that exploring in frontier lands no longer makes sense with oil at $50 per barrel. Not too long ago, Greenland was hyped as an unexplored and pristine new oil region. The excitement was enough to fuel a bit of an independence movement within Greenland to pull away from Denmark.
Statoil also put an end to negotiations with Lundin Petroleum over building an oil terminal in Norway’s far north. Building an Arctic terminal would aid the development of several offshore oil and gas fields in the Barents Sea, where the companies each have made several discoveries.
…click on the above link to read the rest of the article…
Russia To Increase ‘Combat Capabilities’ In Crimea, Sees Ukraine Conflict Worsening
Russia To Increase ‘Combat Capabilities’ In Crimea, Sees Ukraine Conflict Worsening
Following the adoption of its new military doctrine signed by President Vladimir Putin in December which identifies NATO expansion as an external risk, it is perhaps hardly surprising that, as Reuters reports, Russia’s top general, Valery Garesimov stated that the “Defence Ministry will focus its efforts on increasing the combat capabilities of its units and increasing combat strength.. with special attention will be given to the groups in Crimea.” Amid renewed heavy shelling in Donetsk,NATO’s top military commander noted they will be stepping up exercises in the Baltic Sea region as Russian Deputy Foreign Minister Grigory Karasin warns, “the situation in eastern Ukraine is deteriorating.”
Russia’s top general said on Tuesday he would beef up combat capabilities this year in Crimea, the Arctic and the country’s westernmost Kaliningrad region that borders two NATO states.The remarks by General Valery Gerasimov, chief of the General Staff of the Armed Forces, are likely to deepen concern in the West over what it sees as Russia increasingly flexing its muscles since the start of the crisis in Ukraine.
“In 2015, the Defence Ministry will focus its efforts on increasing the combat capabilities of its units and increasing combat strength in accordance with the military development plans,” Gerasimov told Russian journalists.
“Special attention will be given to the groups in Crimea, the Kaliningrad region and the Arctic,” he was quoted as saying by Russian news agencies but gave no further details.
…click on the above link to read the rest of the article…
If Shell Backs Out, Arctic Oil Off the Table for Years
If Shell Backs Out, Arctic Oil Off the Table for Years.
The next several months may be pivotal for the future of oil development in the Arctic.
While Russia has proceeded with oil drilling in its Arctic territory, the U.S. has been much slower to do so. The push in the U.S. Arctic has been led by Royal Dutch Shell, a campaign that has been riddled with mistakes, mishaps, and wasted money.
Nearly $6 billion has been spent thus far on Shell’s Arctic program, with little success to date. Now, 2015 could prove to be a make or break year for the Arctic. Shell may make a decision on drilling in the Chukchi and Beaufort Seas by March 2015. If it declines to continue to pour money into the far north, it may indefinitely put Arctic oil development on ice (pun intended).
The crossroads comes at an awful time for Shell. Oil prices, hovering around $60 per barrel, are far too low to justify Arctic investments. To be sure, offshore drilling depends on long-term fundamentals – any oil from the Arctic wouldn’t begin flowing from wells until several years from now. That means that weak prices in the short-term shouldn’t affect major investment decisions.
A Pessimist’s Guide To The World In 2015 | Zero Hedge
A Pessimist’s Guide To The World In 2015 | Zero Hedge.
Skirmishes in the South China Sea lead to full-scale naval confrontation. Israel bombs Iran, setting off an escalation of violence across the Middle East. Nigeria crumbles as oil prices fall and radicals gain strength. Bloomberg News asked foreign policy analysts, military experts, economists and investors to identify the possible worst-case scenarios, based on current global conflicts, that concern them most heading into 2015.
Tracking the fate of ancient carbon in the Siberian Arctic | Ensia
Tracking the fate of ancient carbon in the Siberian Arctic | Ensia.
The Siberian Arctic is one of the most remote and pristine corners of the planet. During the brief summer season, temperatures can climb into the 90s Fahrenheit, and the seemingly endless expanse of boreal forest — or taiga — and tundra explodes with plant and animal life. Every summer since 2008, R. Max Holmes and colleagues from the Woods Hole Research Center have brought a growing international team of undergraduate and graduate students halfway around the world to the Northeast Science Station near Cherskiy, Siberia. The project, called Polaris, is designed to immerse students in the arctic environment and mentor them as they carry out their own original research on permafrost, the supposedly permanently frozen soil beneath their feet.
During the Pleistocene, about 2 million to 11,000 years ago, herds of mega-herbivores including mammoth and woolly rhinoceros grazed vast, fertile grasslands that stretched across the entire Arctic. Over thousands of years, the carbon-rich remains of this productive ecosystem were slowly compacted and frozen into the soil. The amount of carbon stored in Arctic permafrost soil is estimated to be 1,500 billion tons — more than double what is currently in our atmosphere or four times as much as all of the forests on Earth.
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The Big Chill: Tensions in the Arctic – FPIF
The Big Chill: Tensions in the Arctic – FPIF.
One hundred and sixty-eight years ago this past July, two British warships—HMS Erebus andHMS Terror—sailed north into Baffin Bay, bound on a mission to navigate the fabled Northwest Passage between the Atlantic and the Pacific oceans. It would be the last that the 19th-century world would see of Sir John Franklin and his 128 crew members.
But the Arctic that swallowed the 1845 Franklin expedition is disappearing, its vast ice sheets thinning, its frozen straits thawing. And once again, ships are headed north, not on voyages of discovery—the northern passages across Canada and Russia are well known today—but to stake a claim in the globe’s last great race for resources and trade routes.
How that contest plays out has much to do with the flawed legacies of World War II, which may go a long way toward determining whether the Arctic will become a theater of cooperation or—in the words of former NATO commander and U.S. Admiral James G. Stavridis—an “icy slope toward a zone of competition, or worse, a zone of conflict.”
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