Disappointing exploration results, high costs and reghulatory uncertainty have led Royal Dutch Shell to abandon its eight-year quest to harvest oil from the Arctic seas off Alaska
Royal Dutch Shell has announced that it is to abandon its highly controversial attempt to extract hydrocarbons from a region in Arctic waters off the coast of Alaska.
The company has spent an estimated $7bn over the past eight years on drilling an exploratory well in the Chukchi Sea, in 300m of water some 150 miles from Barrow, Alaska, but says that it did not find evidence of sufficient reserves of oil and gas to warrant further exploration. The 6800ft (slightly deeper than 2km) well will now be sealed and abandoned, and Shell says it will no longer explore for oil in offshore Alaska “for the foreseeable future”.
The decision to abandon Alaska is related to a mixture of factors, Shell says. These include the results from the Burger J exploratory well, the high costs associated with the project, and the “challenging and unpredictable federal regulatory environment in offshore Alaska”.
A company spokesperson confirmed to The Engineer that this does not mean the company is abandoning all prospect of harvesting hydrocarbons from the Arctic; Shell has also investigated oil reserves in the Northwest Territories of Arctic Canada; and off the coast of Greenland.