Shell Ends Arctic Drilling

Shell has said that it will stop drilling in the Arctic, causing celebration among environmental activists who had sought to stop the company from exploring for oil in the polar north through various protest actions.

The company seems to have ended its exploration for oil and natural gas in the Chukchi Sea as a result of both public opposition to the project and the fact there did not seem to actually be very much oil to be drilled for, according to The Guardian.

The lack of oil made it increasingly difficult to justify the $7 billion the company has already spent exploring for hydrocarbons in the area. The decision to stop drilling will reportedly cost the company another $4.1 billion.

The cost of oil being at record lows has not helped the company either, as it seems unlikely the price will rebound anytime soon, making it all the more difficult for the company to recoup its Arctic investment. A barrel of oil currently costs around $52, has fallen as low as the high 30s and is far off the mark of $90 to $100 that had long been the norm.

The company also already had a spotty record in the Arctic, having lost control of a deep-sea rig called the Kulluk, which ran aground on the coast of Alaska after severe weather caused the rig to separate from the ship that was towing it.

This accident was a major factor in environmental opposition to Shell's drilling in the Arctic. That opposition spawned a flotilla of environmentalists in Kayaks that tried to hem in Shell's new oil rig in Seattle. In another episode, a ship that was critical to the exploration effort was delayed by environmentalists who suspended themselves from a bridge under which the ship had to pass, making it impossible for the ship to proceed.