An ongoing legal dispute will delay Royal Dutch Shell's plans to drill for oil and natural gas in the Beaufort Sea offshore Alaska through the rest of the year, the oil major said Friday.

The Minerals Management Service in early 2007 approved a drilling plan by affiliate Shell Offshore Inc. (SOI), and Shell was scheduled to begin drilling some exploration wells last summer (see Daily GPI, July 16, 2007).

However, a lawsuit filed by several environmental groups, area stakeholders and the North Slope Borough scuttled Shell's plans. The U.S. Court of Appeals for the Ninth Circuit in San Francisco last August blocked SOI's drilling, and it has yet to issue a ruling on whether Shell may proceed (see Daily GPI, Aug 20, 2007).

SOI Friday said it had decided to not resume its drilling plan in the region this year.

"This lack of decision has delayed drilling for another year -- extending the timeline it will take to bring this much-needed U.S. production on-line," said Shell spokesman Curtis Smith.

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