By July 7, 2016 Read More →

US Arctic energy development regulation finalized

Arctic energy

Some industry groups say the Obama administrations Arctic energy rules are an attempt to stifle offshore energy development. US Pacific Command photo.

US Arctic energy development rules set standards for Outer Continental Shelf

By Valerie Volcovici

WASHINGTON, July 7 (Reuters) – The U.S. Department of Interior on Thursday unveiled its final regulations on drilling in the U.S. Arctic Outer Continental Shelf to boost safety in the environmentally sensitive region.

The rules set safety standards for exploratory drilling on the U.S. Arctic Outer Continental Shelf for vessels on Alaska’s Beaufort and Chukchi Seas.

“The rules help ensure that any exploratory drilling operations in this highly challenging environment will be conducted in a safe and environmentally responsible manner, while protecting the marine, coastal and human environments, and Alaska Natives’ cultural traditions and access to subsistence resources,” said Janice Schneider, the Interior Department’s assistant secretary for land and minerals management.

The rules are a key part of the Obama administration’s strategy for energy development in the Arctic region, Schneider said.

Oil and gas exploration in the U.S. Arctic has been limited. Last year, Royal Dutch Shell pulled the plug on its Arctic oil exploration plans after failing to find enough crude oil, despite getting permission from the United States to drill.

The company had spent $7 billion exploring in the waters off Alaska’s coast. In 2012, Shell interrupted Arctic exploration after an enormous drilling rig broke free and ran aground.

The new rules require oil operators to submit a detailed operations plan before filing an exploration request. The operators must also demonstrate that they can quickly deploy containment equipment, such as capping stacks or domes, as well as a relief rig in the event of a well accident.

The Interior Department’s environmental enforcement director, Brian Salerno, said the rules were developed to address issues identified after Shell’s 2012 rig accident.

“This rulemaking seeks to ensure that operators prepare for and conduct these operations in a manner that drives down risks and protects both offshore personnel and the pristine Arctic environment,” Salerno said.

Kristen Miller, conservation director of the Alaska Wilderness League, said the Interior Department released “minimum regulations” – a first step that needs to be further strengthened.

National environmental groups went further and said the Interior Department should not allow any drilling in the Arctic.

Rachel Richardson of Environment America said: “The only ‘safe’ form of drilling for the Arctic and the climate is none at all.”

But industry groups like the American Petroleum Institute quickly reacted to the announcement by saying the regulation is the latest attempt by the Obama administration to stifle offshore energy development.

(Additional reporting by Adam DeRose; Editing by Peter Cooney and Leslie Adler)

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