Shell initiates Beaufort Sea oil exploration

Offshore staff

(US) - Shell is planning to begin its Beaufort Sea oil exploration this summer, an Alaska state official says.

The initial work will involve excavating "well cellars" from below the sea floor.

The cellars, also known as glory holes, protect well equipment such as blowout preventers, from ice scouring, says Bill Hutmacher, industry preparedness manager for the state Department of Environmental Conservation.

Although the actual permitting will be handled by the US Minerals Management Service, which has jurisdiction over the Shell leases in federal waters, the state will be making a determination about whether Shell's exploration and spill-cleanup plans meet state laws and regulations, Hutmacher says.

Shell plans to start excavations in August and work only during open-water seasons -- before the ice comes in, he says.

The company has acquired one drill rig, the Kulluk, but Shell officials told him they will need a second drilling vessel as backup, Hutmacher says.

The Kulluk has been mothballed since 1993 and now sits in a remote bay along Canada's Northwest Territories, says Cam Toohey, a Shell spokesman in Anchorage.

Shell bought the rig late last year from Seatankers Management Co., based in Cyprus.

Shell plans to refurbish the rig where it sits and then move it into the Beaufort Sea off the Alaska coast to drill on the company's leases, Toohey says.

Exploration drilling is planned to start in July 2007.

03/17/06

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