Shell Delays Arctic Oil Drilling Until 2013

The following is an excerpt from an article in:


The New York Times
Tuesday, September 18, 2012

Shell Delays Arctic Oil Drilling Until 2013

By CLIFFORD KRAUSS

HOUSTON — With the prospect of rich new oil fields in tantalizing reach, Shell Oil announced on Monday that it was forced to put off completing wells in the Alaskan Arctic for another year after a spill containment dome was damaged during a testing accident.

While the company will perform preliminary work this year on several wells in the region, it will not be able to drill for oil until next summer at the earliest.

The latest setback in Shell’s six-year, $4.5 billion effort to drill off the coast of Alaska heartened environmentalists, who have opposed the drilling program at every turn.

Some suggested that Shell’s inability to control its containment equipment in calm waters under predictable test conditions suggested that the company would not be able to effectively stop a sudden leak in treacherous Arctic waters, when powerful ice floes and gusty winds would complicate any spill response.

But the company received a shot of encouragement from the Obama administration, which defended Shell’s efforts and expressed the desire to continue working with the company to open the Arctic for drilling next year.

Shell expected to receive all the necessary permits to drill up to five wells this summer and fall, but equipment problems and persistent sea ice forced the company to cut back its program repeatedly.

“It’s a disappointment that this particular system is not ready yet,” said Marvin E. Odum, the president of Shell Oil, in an interview. “We’ve made the call that we are better off not drilling in hydrocarbons this year.”

It was the third year in a row that Royal Dutch Shell, the parent company, was frustrated in one of its most ambitious global endeavors.

In 2010, the disastrous BP oil spill in the Gulf of Mexico stalled its efforts to win regulatory approval. In 2011, delays in getting final approval for an air quality permit forced the company to delay drilling.

This year, the company won almost all the regulatory approvals it needed. It recently began drilling pilot holes, and it hoped to drill at least one or two exploratory wells into deep zones that could hold oil and gas by the end of October.

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Energy Spurs Recovery in Houston

Excerpt from an article in The New York Times
Wednesday, February 08, 2012

Energy Spurs a Recovery in Houston Real Estate 

By KRISTINA SHEVORY

HOUSTON — In most cities, companies are holding tight, mothballing office expansions and delaying new hires. But not in Houston.

Powered by a rise in oil prices and a shale exploration boom, Houston is the first major metropolitan region to regain all the jobs it lost in the recession. The region added about 76,000 jobs last year, according to the Texas Workforce Commission, and is on pace to pick up tens of thousands more this year.

Oil and gas companies, from the biggest names like Exxon Mobil to the smallest independents, are dusting off plans to expand, relocate or put up new buildings. Last year, 1.8 million square feet of commercial space was vacuumed up, and real estate brokers expect the same or greater this year. “No question, it’s energy,” said Jim Arket, a senior vice president at Grubb & Ellis in Houston. “That’s been the plus multiplier of Houston.”

The resurgence can be partly tied to the lifting in fall 2010 of the government moratorium on deepwater drilling in the Gulf of Mexico after the BP oil spill. The bulk of the gulf’s drilling and profits comes from those offshore waters. Shale drilling has also bolstered balance sheets.

Nexen, a Canadian company, is moving its American headquarters from Plano, Tex., to Houston after it received permits to restart deepwater drilling in the gulf. “Houston is quite clearly the place to be for a deepwater operator,” said Grant Dreger, the vice president for finance and administration at Nexen Petroleum U.S.A. “You have loads of deepwater talent, and it’s home to the majority of our joint venture partners.”