Drilling delays aren't slowing Shell's Alaska pipeline work

WAINWRIGHT, Alaska -- On Sunday evening, a crew of scientists pulled their gear from the belly of a small plane in this Arctic village, climbed into a pickup truck and headed down the gravel road to town.

Over the next two weeks, the six aquatic researchers will be studying marine life along Wainwright's Chukchi Sea shore and in the inland Wainwright lagoon. Their research, funded by Royal Dutch Shell PLC, will be fed into an environmental impact statement the company must submit to federal regulators before building a local oil pipeline.

The company has tentative plans to build a pipeline to Wainwright from its leases 100 miles from shore. From there, the pipeline would stretch 280 miles east through Alaska's lake-laced frozen tundra to Prudhoe Bay. There, Shell would transfer the Chukchi oil into the Trans-Alaska Pipeline System, which extends another 800 miles to export terminals in Valdez.

At a time when construction delays and sea ice have hampered Shell's plans to explore for oil this summer in the Chukchi and Beaufort seas, the Wainwright science studies are proof of the company's fundamental faith in the oil potential of its Arctic offshore leases.

Over the past seven years, the company has spent $4.5 billion and fought off dozens of lawsuits in hopes of getting its share of the 27 billion barrels of oil and 132 trillion cubic feet of natural gas that the U.S. Geological Survey estimates are beneath America's Arctic waters. Those massive reserves are thought to be the largest in the United States outside the Gulf of Mexico.

Interior has already issued conditional approval of Shell's plans to drill up to five wells this summer. In the face of continuing delays, however, company officials now say they may be lucky to drill one or two wells before they are required to abandon the region for the winter.

Shell has been hauling much of its drilling equipment up to the Arctic by boat. However, the company's oil spill recovery ship, the Arctic Challenger, is still under construction in Bellingham, Wash., where it is awaiting federal approval.

Once the Interior Department signs off on the project's final permits, the Arctic Challenger will need another two weeks to sail to Alaska's northern waters. Only then would Shell be allowed to sink oil wells into the Beaufort and Chukchi seas.

Inroads in Wainwright

Despite those delays, Shell officials are already taking the preliminary steps necessary to build the massive and costly physical infrastructure that would be needed to carry oil from the Chukchi Sea to the world's energy markets.

The small Native community of Wainwright, population 540, is linchpin in that corporate campaign.

This spring, Shell held a town meeting to lay out plans to study the wildlife populations, hydrology, geology and cultural resources in and near Wainwright's shores. On hand at the meeting in the Wainwright high school gym were Shell officials and the lead scientists.

"We're basically trying to establish the baseline conditions for environmental resources here in the near-shore area for what would be a large pipeline corridor extending to the existing TAPS infrastructure," explained John Seigle, a senior scientist with ABR Inc., an environmental research expert who was at the meeting.

Wainwright residents listening to Shell's plans were apprehensive but open-minded. "Some of the villages on the North Slope have had a lot of interaction with the oil companies over the years, particularly Nuiqsut and Barrow," Seigle said.

"Wainwright has not. So they're obviously concerned about what impact this is going to have on their way of life," he said. "It's a largely subsistence culture. I think they still get more than 80 percent of their food resources from the natural environment. So they're concerned about impacts -- not just about development of oil, but the impacts of the studies that will be taking place."

When researchers returned to town in July, they were instructed to keep an eye out for whales, seals, polar bears and other marine mammals. The town's Inupiat residents were primarily interested in beluga whales, which they regularly harvest.

"We basically need to stop working if we run into a marine mammal or see one," said Seigle, who heads the fish and aquatic resources studies. "As environmental scientists, we don't want to have any kind of an impact on subsistence hunting activities."

Each morning, the researchers checked in with a community subsistence adviser, who alerts them to the most recent whale sightings. During the day, scientists who encountered new whale movements reported them back to the village advisers. "They would make some kind of judgment on whether or not we needed to clear the area or just sit tight and wait," he said.

Once the preliminary studies are completed this fall, Seigle hopes to work more closely with Wainwright residents who are well versed on local fish populations, what the fish eat and seasonal changes in habitat.

"One of the things that we're trying to establish by the end of the season is something along the lines of an expert panel of fishers," Seigle said.

"I've already spoken with a couple of individuals who are sort of known fishers in town -- fishermen and -women. The goal would be to get them in a room and talk about fisheries issues. It would be some sort of the subsistence expert panel. We're just in the beginning stages of that right now."