U.S. Coast Guard sees added burden in Shell's Arctic quest

Reuters News
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Posted: Aug 11, 2015 1:19 PM

By Timothy Gardner

WASHINGTON (Reuters) - The U.S. Coast Guard has been forced to divert resources - including a vessel that fights cocaine trafficking - to the Arctic this summer to ensure that Royal Dutch Shell's exploratory oil drilling meets its environmental and safety commitments, its top officer said.

    The added Coast Guard presence in the Chukchi Sea off Northern Alaska includes the Waesche, a 418 foot-long (127 m) national security ship, which otherwise would be operating in the Caribbean Sea and Gulf of Mexico, fighting drug traffickers.

"That for me is the opportunity cost," Admiral Paul Zukunft, commandant of the Coast Guard, told Reuters in his office at the agency's Washington, D.C. headquarters late last week. "It means you do less somewhere else in order to supplement activity in the Arctic."

Under tight regulatory conditions, the Obama administration this year has given Shell permission to resume exploratory drilling in the Arctic. The decision unleashed waves of protests in the Pacific Northwest, with activists seeking to delay the company's drilling into the oil zone under the Chukchi.

In 2012, the last time the company explored in the Arctic, Coast Guard helicopters had to rescue 18 Shell workers from an out-of-control oil rig in stormy seas, one of several mishaps the company suffered that year.

The rig ran aground and had to be scrapped. A later Coast Guard report was sharply critical of Shell's safety preparation and conduct.

Now Shell is bringing a fleet of about 25 vessels to the Chukchi. The Fennica, an icebreaker carrying emergency capping equipment, was expected to be in place on Tuesday, fulfilling a requirement for exploration that is expected to run until October.

The Fennica was returning from dry dock in Portland, Oregon, where it had been forced to return after gashing its hull on uncharted shoals in Alaska's Dutch Harbor.

"We have tremendous respect for the Coast Guard and look forward to building on the partnership we have forged in the Arctic over the last several years," said Curtis Smith, a Shell spokesman.  

With the nearest deepwater port 1,000 miles (1,610 km) from the Chukchi, the Coast Guard is sending five ships to the region, including the Waesche, part of a new fleet of Coast Guard ships equipped with advanced sensors that contribute to intelligence gathering.

The Coast Guard has also set up a helicopter base in Deadhorse, Alaska, to support Shell's oil exploration. Two Jayhawk helicopters stationed there would normally be on the ready for search and rescue in Kodiak, an area that has received increased recreational activity.

Should Shell suffer an incident this year, the Coast Guard would have to extend patrols, cancel planned exercises, or take resources from fishery enforcement in remote areas, Zukunft said.

Shell's top executive in the Arctic, Ann Pickard, was quoted by Bloomberg last week saying: "We know how to operate in places where there's challenging weather. Alaska is no worse, and in many ways better than some other places."

But Zukunft emphasized the dangers of the Arctic's harsh and volatile weather. Indicating a painting in his office of a ship he once commanded in the Bering Sea, Zukunft said hurricane force storms can form more than once a week in Northern Alaska, with little notice.

"I've been around the world," said Zukunft. "I have never seen anything like it up there. What's really concerning is how quick the weather changes."

Asked if he was satisfied that Shell had learned adequately from its experience in 2012, Zukunft said: "I am right now."

(Editing by Bruce Wallace and Matthew Lewis)