By Roy L Hales
In what some are calling a people’s victory and others a case of diminutive financial prospects, Shell is pulling out of the Arctic. They drilled to a total depth of 6800 feet this summer, but did not find sufficient oil and gas to warrant continuing. Shell ceased operations in the Arctic and “will continue to de-mobilize people and equipment from the Chukchi Sea.”
A Futile Search In the Chukchi Sea
The oil company is believed to have spent about $7 billion on Arctic offshore development and has faced increasing pressure from shareholders worried about the plunging share price and the costs of what has so far been a futile search in the Chukchi Sea.
“The Shell Alaska team has operated safely and exceptionally well in every aspect of this year’s exploration program,” said Marvin Odum, Director, Shell Upstream Americas. “Shell continues to see important exploration potential in the basin, and the area is likely to ultimately be of strategic importance to Alaska and the US. However, this is a clearly disappointing exploration outcome for this part of the basin.”
An Unmitigated Defeat
Greenpeace UK executive director John Sauven responded with a press release stating:
“Big oil has sustained an unmitigated defeat. They had a budget of billions, we had a movement of millions. The ‘unpredictable regulatory environment’ that forced Shell out of the Arctic is otherwise known as massive pressure from more than 7 million people. For three years we faced them down, and the people won.
The Save the Arctic movement has exacted a huge reputational price from Shell for its Arctic drilling programme. And as the company went another year without striking oil, that price finally became too high. They’re pulling out.”
“Soon the nations of the world will gather in Paris to negotiate a deal on climate change. Shell’s defeat shows which way the wind is blowing. If a movement of seven million people can beat one of world’s biggest energy companies, think what we can do when we come together in our tens and hundreds of millions. This is a moment to appreciate that when we assert our power, we can win extraordinary victories in the fight against climate change.”
Top Photo Credit: Sea Ice Patterns from the 2011 expedition of the U.S. Coast Guard Cutter Healy in the Beaufort and Chukchi seas – by NASA/Kathryn Hansen via Flickr (CC BT SA, 2.0 License)