Bloomberg News

Shell Gear Needs More Tests Before Alaska Permits, Official Says

June 14, 2012

Royal Dutch Shell Plc (RDSA) must complete more tests of its safety equipment before the U.S. lets the company drill for oil off the north coast of Alaska, a regulator said.

The examinations, which will verify whether Shell is able to stop the flow of oil in case of a blowout, will take place in coming weeks, James Watson, director of the Interior Department’s Bureau of Safety and Environmental Enforcement, said today during a conference call.

“These tests must be successful before we approve any drilling activities, because safety is a must and it’s our No. 1 priority,” Watson said in Portland, Oregon, after looking over equipment to be used when a well fails. “There are still a number of inspections by BSEE and the U.S. Coast Guard” on Shell’s equipment.

Shell, based in The Hague, is counting down the weeks or days as it awaits the final of 35 permits needed to start exploration in Alaska’s Chukchi and Beaufort seas. Due to ice, the company can only drill in the Arctic when ice has cleared, typically from July until October.

Steve Phelps, Shell Alaska manager for exploration and appraisal, told reporters June 12 that thick ice has formed in the region and will delay the start of any drilling by about two weeks.

To contact the reporter on this story: Katarzyna Klimasinska in Washington at kklimasinska@bloomberg.net

To contact the editor responsible for this story: Jon Morgan at jmorgan97@bloomberg.net


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