Shell faces probe over Alaska rig accident
A US Coast Guard admiral has promised a thorough investigation into potential breaches of the law and safety regulations when a drilling rig that had been working for Royal Dutch Shell in the Arctic ran aground off Alaska on New Year’s eve 2012.
Rear-admiral Joseph Servidio highlighted what he called the “inadequate assessment and management of risks by the parties involved” as the most significant cause of the accident, adding that he was “most troubled” by “the significant number and nature” of the potential violations.
In a statement published with the Coast Guard’s official report on the grounding of the Kulluk drilling rig, Rear-admiral Servido also drew attention to the importance of the safety management systems used by the crews of the ships involved and the operating company running the project, which was Shell.
“If the potential violations of law and regulations noted in the report actually occurred, far greater levels of oversight will be required,” he wrote.
The report is another blow for Shell’s hopes of drilling in the Arctic waters north of Alaska, where it believes it has the potential to discover large new oilfields.
The exploration campaign, which has been dogged by protests and legal challenges from environmentalists, as well as extreme technical difficulties, was estimated last year to have already cost about $5bn, before the company had drilled into a single oil-bearing rock.
Shell was forced to abandon a plan to drill in the Arctic this year after a successful legal challenge to its licences, and Ben van Beurden, the group’s new chief executive, has been non-committal about whether it will try again next year.
The Kulluk was a rig with an unusual conical design, suitable for withstanding icy Arctic waters but hard to transport. It had no propulsion of its own and had to be towed into position.
Shell planned to move it to Seattle in December 2012 for repairs, in part to save millions of dollars in Alaskan tax that would have been payable if it had remained in the state’s waters on January 1 2013.
Its towing cable snapped in rough seas, however, and after attempts to retrieve the rig failed, it ran aground on an island off Alaska’s south coast on December 31.
Much of the Coast Guard report focuses on the decisions taken on board the Aiviq, the tug towing the rig, which was owned by Edison Chouest Offshore, a marine transport company.
The report concluded that the Aiviq’s master, chief engineer, and third mate may all have been negligent at certain points during the incident.
It said there was “evidence that a violation of law or regulation may have occurred on the part of Edison Chouest Offshore in that they failed to report . . . numerous marine casualties and safety related vessel issues”.
It added: “This matter should be turned over to the cognizant civil penalty authority for consideration.”
Ed Markey, a Democratic senator who is a longstanding critic of Shell’s Arctic drilling programme, said the company “should be held accountable for its reckless behaviour.”
He added: “This report shows that Shell ran through every single safety and common sense red light in moving this rig because of financial considerations. This kind of behaviour should raise major red flags for any future Arctic drilling plans”.
Lisa Murkowski, the Republican senator from Alaska, said the Coast Guard had made good recommendations to improve the safety of Arctic drilling in the future.
“I believe that we can safely develop our energy resources in the Arctic, but it requires that we adhere to world-class safety standards,” she said.
Shell said it was reviewing the report, adding: “Already, we have implemented lessons learnt from our internal review of our 2012 operations. Those improvements will be measured against the findings in the USCG report as well as recommendations from the US Department of Interior.”
It said last year that the Kulluk would be scrapped.
Edison Chouest did not immediately respond to requests for comment.