Pete Slaiby, Shell Alaska’s vice president for exploration and appraisal, said the company hopes to drill as many as five wells in the Chukchi Sea and Beaufort Sea next year.
“This is really big,” Slaiby told a crowd at a Greater Fairbanks Chamber of Commerce luncheon. “It’s really important because of the resources involved.”
The heightened optimism comes after a summer in which Shell cleared several key permitting steps. Shell received preliminary approval from the Environmental Protection Agency for air permits in July, and Slaiby said final approval could be made within a few days. In August, the federal Bureau of Ocean Energy Management, Regulation and Enforcement gave conditional approval to exploration in the Beaufort Sea.
The next step comes in early October, when Interior Secretary Ken Salazar will decide whether to approve a drilling plan for the Chukchi Sea. Slaiby said Shell plans to finalize its 2012 offshore drilling plans later that month.
Slaiby said there’s no guarantee Salazar will give his approval, but he said Shell has passed enough legal, permitting and environmental tests that it will ultimately be allowed to proceed.
In some ways, Shell is already moving forward with its plans for offshore exploration in 2012. Slaiby said drilling resources are being routed to Alaska from all over the world — including Norway, China, the Gulf of Mexico and New Zealand — in anticipation of a busy year.
If exploration in the Beaufort and Chukchi does proceed, Slaiby said, the implications could be huge. He said an estimated 25 billion barrels of oil is located there, which could mean as much as 700,000 additional barrels of oil per day flowing through the trans-Alaska oil pipeline.
That would more than double the volume of oil currently in the pipeline, which would help alleviate low-flow concerns caused by decades of declining production.
“It’s going to be significant in terms of extending the life of the trans-Alaska pipeline,” he said.