US Govt Gives Shell Go Ahead for Oil Drilling in Arctic Ocean

Published By : 18 Aug 2015 | Published By : QYRESEARCH

The federal government of the United States gave oil giant Royal Dutch Shell the green light on Monday to drill for crude in the Arctic Ocean, just off the north western Alaskan coast. The Interior Department issued a permit to the Anglo Dutch multinational oil and gas company allowing it to explore further into the Arctic Ocean floor after giving the company conditional drilling approval in May this year. The drilling will be the first such exploration in over two decades in the US region of the Arctic Ocean. This area is estimated to house around 26 billion barrels of recoverable crude. This could remarkably boost domestic production of oil in the United States, which is presently at a level of 9.5 million barrels a day.

The Bureau of Safety and Environmental Enforcement announced its approval to allow Shell to drill deeper into the ocean floor after the oil and gas giant brought a necessary piece of equipment called the capping stack to avoid a potential well blowout. The agency had previously given Royal Dutch Shell permission to start drilling only the higher sections of two wells in the Chukchi Sea since the capping stack was caught on a vessel that needed to be repaired in Oregon’s Portland. Since the vessel arrived last week, Royal Dutch Shell can begin drilling into the oil bearing rock, which is estimated to be 8,000 feet below the ocean floor. This is the first time the rock will be drilled after its previous exploratory well was drilled back in 1991. Shell has already spent more than US$ 7 billion in exploring the Chukchi Sea, after bidding US$ 2.1 billion on leases in 2008. Shell has also spent major chunk of money on exploration in the Beaufort Sea just off the north coast of Alaska. 
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