Shell halts Arctic oil drilling in 2013

Royal Dutch Shell PLC announced Wednesday it would suspend drilling for oil in the Arctic Ocean in 2013. Shell has experienced several setbacks this winter in its Arctic oil drilling plans.

US Coast Guard/Petty Officer 2nd Class Zachary Painter/Reuters/Handout/File
The conical drilling unit Kulluk sits grounded 40 miles southwest of Kodiak City, Alaska in this US Coast Guard handout photo. In 2012, Shell drilled top holes on two wells in the Beaufort and Chukchi, but drilling was hampered by problems.

Royal Dutch Shell PLC announced Wednesday it will not drill for petroleum in the Arctic Ocean in 2013.

Shell Oil Co. President Marvin Odum said in an announcement that the company will "pause" its exploration drilling in the Chukchi and Beaufort seas.

The company made progress in Alaska, but Arctic offshore drilling is a long-term program that the company is pursuing in a safe and measured way, Odum said.

In 2012, Shell drilled top holes on two wells in the Beaufort and Chukchi, but drilling was hampered by problems.

Shell has experienced setbacks this winter with both its drill ship, the Noble Discoverer, and the drilling barge Kulluk.

After summer exploration in the Beaufort Sea, the Kulluk ran aground on New Year's Eve near Kodiak Island as it was being towed to Seattle for maintenance and broke free in a storm. It was refloated and taken to a sheltered harbor for further inspection.

It's currently being towed to Dutch Harbor, where it will be prepared for a dry tow transport to Asia.

The Noble Discoverer operated in the Chukchi Sea.

But the Coast Guard found 16 violations after the drilling season when the Noble Discoverer was in dock in Seward, Alaska.

The Coast Guard said last week that it's turned its investigation of this ship over to the U.S. Department of Justice.

Several investigations and reviews of the 2012 Arctic offshore drilling season are under way.

Interior Secretary Ken Salazar has announced that his department would perform an "expedited, high-level assessment" of the summer drilling season.

Salazar said the review would pay special attention to challenges that Shell encountered with the Kulluk, with the Discoverer and with the company's oil spill response barge, which could not obtain certification in time for the drilling season.

Salazar announced the 60-day review shortly after the Coast Guard commander overseeing the Alaska district said he had ordered a formal marine casualty investigation of the Kulluk.

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