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Shell halts drilling in the Arctic for 2013

By John M. Broder / New York Times News Service
Published: February 28. 2013 4:00AM PST

WASHINGTON — Royal Dutch Shell, after a series of costly and embarrassing accidents in its efforts to drill exploratory wells off the north coast of Alaska last year, announced Wednesday that it would not return to the Arctic in 2013.

The company’s two drill ships suffered serious accidents as they were leaving drilling sites in the Beaufort and Chukchi seas last fall and winter and are being sent to Asia for repairs. Shell acknowledged in a statement that the ships would not be fixed in time to drill during the short summer window this year.

“Our decision to pause in 2013 will give us time to ensure the readiness of all our equipment and people," said Marvin Odum, president of Shell Oil Co.

He said Arctic offshore drilling was a long-term project that the company would continue to pursue.

The Interior Department, the Coast Guard and the Justice Department are reviewing Shell’s operations, which have included groundings, environmental and safety violations, weather delays, the collapse of its spill-containment equipment and other failures.

The setbacks come after Shell has invested more than $4.5 billion in leases and equipment and spent several years on an intensive lobbying campaign to persuade federal officials that it could drill safely in the unforgiving waters of the Arctic Ocean. Shell now acknowledges that the venture has been much more difficult than it anticipated.

Shell had planned to drill as many as 10 wells in 2012 but was able to start only two.

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