Bloomberg News

Noble Sees Shell’s Alaska Rig Ready for Drilling in 2013

December 27, 2012

Noble Corp. (NE:US) expects to have its Noble Discoverer rig ready for Royal Dutch Shell Plc (RDSA) to resume drilling in Alaska’s Chukchi Sea next year, after fixing issues raised during a U.S. Coast Guard inspection.

The Coast Guard determined the ship’s propulsion and safety management systems need attention, the Zug, Switzerland-based company said in a statement today. Noble expects to fix the ship before the Arctic drilling season begins when sea ice clears in six months or so, said John Breed, a company spokesman in Sugar Land, Texas.

Shell invested $4.5 billion in offshore leases and equipment and fought at least 50 lawsuits from environmental groups to begin drilling in the Chukchi, the first wells in the Arctic waters in about 20 years. The Hague-based company is operating the rig under a two-year contract at a rate of $240,000 a day, according to a Dec. 6 Noble report.

The Coast Guard is “looking at the vessel from a performance standpoint and they’re asking us to look into this further,” Breed said. “We’re developing a hit list of items they want us to address.”

Inspectors based in Anchorage boarded the ship after it lost propulsion while docking at the southern Alaska port of Seward in late November, Kip Wadlow, a Juneau-based Coast Guard spokesman, said today in an interview.

‘Serious Discrepancies’

“They found several serious discrepancies with the crew safety and pollution-prevention equipment on board the vessel,” Wadlow said. Captain of the Port Paul Mehler on Nov. 29 issued a detention order that held the ship at Seward until repairs brought it up to U.S. and international safety standards, he said.

Mehler lifted the order Dec. 19, Wadlow said. Noble plans to have the Discoverer towed to a shipyard to repair its propulsion system and undergo routine maintenance, he said.

Noble’s review found that the ship may have improperly discharged on-board water when it wasn’t drilling. The Coast Guard inspection, begun last month, continues.

After six years of preparation, Shell began drilling in September off the northwest coast of Alaska, two months later than planned. A day later, drilling was halted and the rig was moved to avoid encroaching sea ice.

Shallow Wells

The Arctic operations suffered another setback days later when a containment dome designed to cap a potential spill was damaged. Shell decided it wouldn’t have time this year to drill deep enough to reach oil in the Chukchi. Instead, it drilled a series of shallow exploratory wells and plans to go deeper in 2013, Marvin Odum, president of Shell’s U.S. unit, told reporters on Nov. 29.

Noble Discoverer was inspected by the U.S. Coast Guard in July after it slipped its moorings and drifted toward shore in the Aleutian Islands. The ship, now docked at Seward, Alaska, will move to Vigor Industrial LLC’s shipyard in Seattle for service and maintenance, Breed said.

“It’s advantageous that the drilling season is behind us,” Breed said. “We have a long period during which we can do this sort of maintenance. The rig was scheduled to be down for maintenance anyway.”

To contact the reporter on this story: Jim Polson in New York at jpolson@bloomberg.net

To contact the editor responsible for this story: Tina Davis at tinadavis@bloomberg.net


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  • NE
    (Noble Corp plc)
    • $29.91 USD
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