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Shell Announces Alaska Arctic Operations Cease after “Disappointing Exploration Outcome”

It’s been a long and controversial ride for the largest European oil company who first discovered oil and gas in the region in the late 1980s. The company was looking to go full gear during a two-year drilling program starting this July after it halted its operations in 2012 when its primary drilling rig ran aground and was lost. However, Shell has now decided to cease further exploration activity in offshore Alaska for the foreseeable future.
Greenpeace has welcomed Shell's decision instantly 1 photo
The Burger J well is approximately 150 miles from Barrow, Alaska, in about 150 feet of water. The Dutch oil giant drilled to a total depth of 6,800 feet this summer in a basin that demonstrates many of essential attributes of an important petroleum basin - the company explains in a statement released today.

However, these indications are not sufficient to warrant further exploration in the Burger prospect; thus the well will be sealed and abandoned by U.S. regulations. The decision comes after years of opposition targeted from environmentalists such as Greenpeace whose actions culminated with this summer’s occupation of the company’s drilling rigs.

Big Oil has sustained an unmitigated defeat,” Greenpeace U.K. Executive Director John Sauven said in a statement for Bloomberg. “The Save the Arctic movement has exacted a huge reputational price from Shell for its Arctic drilling program. And as the company went another year without striking oil, that price finally became too high.”

Looking at the Oil Giant’s statement, it feels like the environmentalists are right about one thing, drilling for the oil in the current price state has become unprofitable.

"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 in a statement you can consult below. "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.”

For some, Shell’s announcement comes as a logic decision, for others it represents a historic win over Arctic pollution and global warming. Either way, we have the feeling it’s also somewhat related to Barack Obama’s visit to Alaska, which was the first time an acting president did something like that ever.


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