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Would-Be Beaufort Sea Drillers Seek Way Around Relief Well Requirement

A fresh environmental battle is brewing over plans to resume gas and oil exploration on the icy top of North America, in Canada's share of the Beaufort Sea.

The Natural Resources Defense Council (NRDC) has stepped forward to lead opposition against proposals by Canadian affiliates of ExxonMobil Corp. and Chevron Corp. to take the hunt out into deepwater.

An anticipated marathon of contested studies and hearings is beginning before a regional Environmental Impact Review Board (EIRB) created by Native claim settlements for the Mackenzie Delta and the National Energy Board (NEB).

NRDC has enrolled in proceedings before both agencies and told the NEB to expect scrutiny every step of the way toward approval of industry plans. The process has begun with reconsideration of a decades-old Canadian safety rule known as same season relief well (SSRW) capability.

ExxonMobil's Imperial Oil and Chevron won the first step by obtaining NEB consent to consider "equivalent" alternatives to the SSRW requirement of backup drilling capacity for immediately siphoning off a spill by boring into an exploration well that blows out.

"We ask that the NEB proceed with extreme caution by declaring an open and rigorous public review," NRDC said in a filing with the Canadian board. "This issue is not limited to local or even national attention.

"The NEB's decisions about SSRW 'equivalency' could have international ramifications that place Canada at odds with its Arctic neighbors and expose the entire Arctic region to the risk of harmful environmental impacts."

The eco-alarm confirmed a recent prediction by former NEB chairman Gaetan Caron, in his farewell address when he retired from the board. "On April 20, 2010, a new board was born," Caron said.

"The world in which we all operate, including the NEB, changed irrevocably when the Deepwater Horizon [deepwater drilling rig] suffered a catastrophic blowout. The world watched as millions of barrels of oil gushed into the Gulf of Mexico for 70-plus days. And they all asked, could this happen here?"

The blowout of BP plc's Macondo well, and the resulting Canadian question, coincided with a technical review of the SSRW rule after Imperial and Chevron quietly asked what issues would need to be recovered if they made applications to restart Beaufort exploration.

The study arose from plans to fulfill work requirements on offshore leases the companies bought from Canada's federal government, by drilling into prospects 125 kilometers (75 miles) or more from the Beaufort coast in water 1,500 meters (4,920 feet) deep.

The Macondo blowout in the Gulf of Mexico riveted Canadian environmental and aboriginal attention on the Beaufort. The NEB expanded the case from a quiet, brisk exchange of regulatory and engineering information among specialists into a prolonged public review.

On top of collecting a library of expert material on Arctic drilling hazards and safety measures, the inquiry held more than 40 meetings in 11 Beaufort coastal communities across the Yukon, Nunavut and Northwest territories.

The result was an updated set of formal "filing requirements" for exploration well applications. The new manual agreed with industry that the SSRW rule could be impractical and replacements deserve to be considered.

Imperial and Chevron have both told the regulators that deepwater Beaufort drilling applications would be a waste of time -- and will not be made -- unless they are allowed to use substitutes deemed to be equivalent to SSRWs. Questions of exactly what would be better alternative safety measures -- and whether yet another full-scale public inquiry is needed to set the standard before reviewing full-dress drilling applications -- were left up to the proceeding now beginning before the EIRB and NEB.

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