Shell and Cairn Unveil Plans for Arctic Drilling Amid Environmental Concerns

Shell has submitted plans to drill 10 exploration wells in the Beaufort and Chukchi seas off the north coast of Alaska, a move that has triggered a new battle with environmentalists. The British oil group, which has leased acreage in the region at a cost of $2bn, claims it can operate safely and responsibly, despite the risks of a spill in one of the world's most pristine natural habitats. Meanwhile, Cairn Energy, a rival oil company, has set sail for Greenland, where it plans to begin drilling in the coming weeks.

Key Takeaways:

• Shell plans to drill 10 exploration wells in the Beaufort and Chukchi seas off Alaska in 2012 and 2013, at a cost of $2bn.
• The drilling program has been criticized by environmental groups, including Greenpeace and the Alaska Wilderness League, which argue that it poses a significant risk to the fragile Arctic environment.
• Shell has submitted plans to the US government for permission to proceed with the drilling program, despite previous setbacks caused by the Deepwater Horizon disaster and regulatory hurdles.
• Cairn Energy is also planning to begin drilling in Greenland, despite opposition from environmental activists.
• The Arctic region has become a new frontier for oil exploration, with estimates suggesting that up to a quarter of the world's undiscovered oil and gas reserves may lie in the region.
• The Obama administration is under pressure to decide whether to approve Shell's plans, with some groups arguing that the drilling program would have a devastating impact on the Alaskan environment and the people who live there.
• The estimated total cost of leasing and planning for Shell's further exploration for oil off the north coast of Alaska is $6bn.

Statistics:

• $2bn: the cost of leasing acreage in the Beaufort and Chukchi seas, according to Shell.
• $4bn: the estimated additional cost of planning for Shell's drilling program.
• $6bn: the estimated total cost of leasing and planning for Shell's further exploration for oil off the north coast of Alaska.
• 2012-2013: the planned start date for Shell's drilling program in the Beaufort and Chukchi seas.
• 10: the number of exploration wells that Shell plans to drill in the Beaufort and Chukchi seas.
• $114: the current price of oil, as reported by Shell.
• 25%: the estimated proportion of the world's undiscovered oil and gas reserves that may lie in the Arctic region, according to the US Geological Survey.

Sources:

• Shell press release
• Cairn Energy press release
• Greenpeace press release
• Alaska Wilderness League press release
• US Geological Survey report
• "The New York Times"
• "The Financial Times"