U.S. Approves Shell’s Arctic Oil Spill Response Plan

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February 17, 2012


WASHINGTON (Dow Jones)–U.S. officials have approved an oil-spill plan for Royal Dutch Shell PLC (RDSA, RDSA.LN) as the company looks to begin drilling in the Arctic, saying Friday that Shell has demonstrated its ability to respond to potential spills in icy waters despite protests from environmental groups.

The approval, granted by the U.S. Interior Department, helps pave the way for Shell to begin drilling in the Chukchi Sea this summer after years of preparation for the project.

Shell still has to obtain drilling permits from the Interior Department before it can move forward.

“We are taking a cautious approach,” Interior Secretary Ken Salazar said in a statement.

Environmental groups have asked the Interior Department to block, or at least postpone, drilling in the Arctic Ocean until oil companies are better equipped to handle spills in waters that freeze over for many months of the year. They have also raised more general objections to drilling in the region, saying that little is known about the region’s wildlife and ecosystems.

In approving Shell’s oil-spill response plan, a crucial part of the federal permitting process, the Interior Department said the company met new requirements adopted after BP PLC’s (BP, BP.LN) Deepwater Horizon oil spill. Shell had to prove that it could respond to a spill that released five times as much oil as a previous contingency plan and make additional preparations for emergencies.

-By Tennille Tracy, Dow Jones Newswires

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