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Beaufort Sea Safety Assurances Sought

The Canadian Yukon province has joined an industry campaign to keep drilling open in the Beaufort Sea by convincing the National Energy Board (NEB) there will be no arctic repeat of last year's Gulf of Mexico Macondo blowout.

In a submission to a safety inquiry by the NEB, Yukon Energy Minister Patrick Rouble described his administration as "committed to responsible development of Beaufort Sea oil and gas resources." The government in Whitehorse has an "overarching goal of positioning Yukon to maximize the potential benefits from offshore oil and gas exploration and development, while ensuring safety and environmental and socio-cultural integrity in the region."

Rouble acknowledged that the frigid, windswept roof of the world is a formidable industrial frontier. But "impossible" has no place in the vocabulary of contemporary heirs to millennia of aboriginal hunting and an international gold rush.

"There is general consensus that the Beaufort Sea has some unique and challenging features such as remoteness, ice and cold, harsh and dark winters affecting oil and gas activity," Rouble told the NEB. "It is Yukon's view, however, that with proper regulatory oversight, skilled personnel, additional infrastructure and increased intergovernmental, intragovernmental and industry collaboration, the potential risks and impacts of oil and gas exploration and development can be identified, assessed and managed to an acceptable level."

In separate NEB filings, industry asks for no more than the narrow window offered by the Yukon's altitude to make a case for keeping Canada's northern frontier open for the handful of companies big enough to tackle arctic operations.

An up-to-date makeover of requirements -- rather than a departure from a national tradition of close supervision -- is sought by the Canadian Association of Petroleum Producers (CAPP), Chevron Canada, ConocoPhillips Canada and Imperial Oil.

The Canadian arctic offshore drilling inquiry -- which began about six months before the Gulf of Mexico blowout and expanded to take the U.S. disaster into account -- focuses on a regulatory legacy of the last northern exploration boom. As a condition of drilling approvals, a 1976 rule requires assurances that relief wells can be completed during the same open-water work season as any blowouts.

The Canadian arctic safety and environmental review starts with blunt industry admissions that no such assurances can honestly be made about the next planned generation of northern offshore wells. The old rule is described as an obsolete relic of 1960s and 1970s drilling in shallow coastal waters with equipment that was superseded long ago.

"Relief wells do not offer the level of protection required for wells in the Beaufort Sea," said an NEB filing by ConocoPhillips, which acquired vast arctic drilling rights and some of the biggest northern Canadian gas and oil discoveries with its takeover of Gulf Canada.

Chevron, which likewise holds an extensive northern Canadian exploration and development portfolio, explained in detail why the relief well provision only offers illusory protection.

On Beaufort coastal shelf sites of the first 20 offshore wells, water depths were only 20-50 meters (66-165 feet). Drilling only went down 3,000-3,500 meters (9,900-11,550 feet). The pressures in target geological formations were normal by land industry standards. The rigs had open-water operating seasons averaging 85 days. Drifting floes of thick ice formed over multiple winters were rare.

On Beaufort shelf edge sites where 19 Canadian wells were drilled, water depths increased to 50-70 meters (165-230 feet). Well depths lengthened to 4,500-5,000 meters (14,850-16,500 feet). Target geological zones became over-pressured. Open-water seasons shortened to 70 days. Multi-year ice posed a frequent hazard.

The next generation of arctic offshore oil and gas exploration, poised to start under leases that the Canadian government has granted over the past few years, is headed out into an area known as the continental slope that qualifies to be called a northern deepwater frontier.

Industry plans call for drilling in Beaufort waters up to 1,200 meters (3,960 feet) deep. The wells are projected to reach targets below 5,000 meters (16,500 feet) beneath the sea floor. Target formations are expected to be consistently over-pressured. Multi-year ice is rated as likely to be an ever-present hazard. The open-water work season will shrink to an average 50 days.

A new generation of jumbo, ice-breaking arctic offshore drilling equipment is on the drawing boards of the first planned deepwater program, a foray planned on a pooling of Beaufort leases held by Imperial, its majority owner ExxonMobil and BP. Chevron and ConocoPhillips are also understood to be working toward a drilling revival in Canadian arctic waters. The region has to date been natural gas-prone. But there have also been tempting finds of liquids-rich gas and crude oil, and far from all technical information about drilling prospects has been disclosed.

CAPP and the companies are urging the NEB to bring Canadian arctic drilling regulation up to date by adopting a "goal-oriented" approach that sets a target of zero for spills and lets exploration projects devise methods for hitting it that are tailored to varying requirements posed by different well sites.

A list of technical advances is on offer, led by backup blowout preventers that ConocoPhillips calls ASID (auxiliary safety isolation device). Chevron calls its entry AWKS (alternative well kill system), and reported that the safety package is currently under development by engineering teams. CAPP and the companies pointed out that the Gulf of Mexico blowout proved, in the end, that a big spill can be brought under control without a relief well.

The Canadian arctic industry plans also include updated versions of company-drafted but regulator-supervised safety, health and environment plans dating back to the 1970s. The equipment and procedures are supported by plans for revived and improved ice monitoring and forecasting systems. Spill cleanup procedures and deposits left over from the last arctic exploration boom are under review.

No firm target date has been promised for completion of the NEB inquiry, which is expected to continue through this year. A lineup of industry critics, such as the World Wildlife Fund, continues to demand an effective ban on Beaufort deepwater drilling by calling for retention of the 1975 same-season relief well capability provision.

Like the Yukon, the development-minded Northwest Territories government is staying out of the green clamor for arctic offshore drilling prohibition. Instead, the territorial government in Yellowknife is filing with the NEB a library of technical material collected by its research into ways to make frontier exploration safe.

On the Mackenzie Delta the Inuvialuit Game Council -- representing the hunters and trappers closest to the industry action -- has told the NEB, "If an oil spill were ever to occur, it will have a devastating impact on the lives of all Inuvialuit and wildlife in the region."

But the council reflects well-known support for the Mackenzie Gas Project by its community, including part-ownership of the proposed northern natural gas pipeline, by stopping short of demanding an outright offshore drilling ban. Instead, the Inuvialuit echo the Yukon in requesting industrial and regulatory adaptations to northern conditions.

"Any development of offshore hydrocarbon resources in the Inuvialuit Settlement Region needs to be done in a way that is responsible and sensitive to the unique circumstances and challenges in the Beaufort Sea," said the council of Mackenzie Delta hunters and trappers. "The Inuvialuit people still rely heavily on the resources from the land and the ocean. The close association with these ecosystems and the wildlife makes Inuvialuit want to ensure that any development is sensitive to their way of life."

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