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Kulluk and Noble Discoverer to Both Be “Dry Towed” to Asia for Costly Repairs

9:19 am in Uncategorized by EdwardTeller

Kulluk

Kulluk on the beach

Shell Oil has finally gone public with the story first carried anywhere back in January by firedoglake, that their conical drill rig, Kulluk, will be taken from Kiliuda Bay in Kodiak to Asia for major repairs. Additionally, their powered drill rig, Noble Discoverer, berthed in Seward, Alaska since being impounded by the U.S. Coast Guard in November, will be “dry towed” across the North Pacific to a shipyard in Asia. Their destination is almost certainly South Korea:

Both the much maligned Noble Discoverer and Kulluk, who have faced serious mechanical difficulties since completing Arctic drilling operations off of Alaska’s Arctic Continental Shelf last summer, will be headed to Asia soon according to a statement from Shell Alaska spokesman Curtis Smith.

The Kulluk, which has remained anchored off of Kodiak Island since its New Year’s Eve grounding, will be towed from there to the international Port of Dutch Harbor pending a tow plan approval. From Dutch Harbor, the 266-foot diameter conical drilling unit will then be dry-towed to a ship yard in Asia with a suitable dry dock.

The Discoverer’s operator, Noble Drilling Corp., will also dry-tow the Discoverer from its current location in Seward to South Korea.

“The outcome of further inspections for both rigs will determine the shipyard schedule and timing of their return to service,” Smith said in the statement.

When exactly the rigs will leave Alaska is unclear. A representative from Unified Command, the joint operation involving Shell, U.S. Coast Guard and Alaska Department of Environmental Conservation, could not say whether the vessel remained in Kiliuda Bay Monday. They noted that the latest information on the vessel was on the command’s website — which hasn’t been updated since Jan. 30.

A “dry tow” or “dry-tow” is movement of a vessel on the deck of a large, semi-submersible ship, or powered, floating drydock.

For some reason, the transponders of all the vessels in and around the Kulluk in Kiliuda Bay, were turned off on January 30th and 31st, two days after I announced the contemplated Asia decision, and the same day Dan Joling from the Associated Press picked up the story, so it is difficult to know where the tug Aiviq is right now, for instance.

Lisa Demer, writing on the new development early this morning for the Anchorage Daily News, notes:

It has big vessels for the dry tows lined up, and the Noble Discoverer will leave Seward in three to six weeks for a trip across the Pacific Ocean that should take two to four weeks, Smith said.

In a dry tow, a large vessel submerges through added ballast below the draft of the rig to be towed, Smith explained. That allows the drilling rig to float over the vessel’s deck, and the tow vessel is raised up, with the drill rig on its deck for the tow. It’s a faster method than towing on the water.

There are rumors that Shell is searching the world for replacement vessels, as it appears neither the Kulluk nor the Noble Discoverer will even be reaching a yard before mid to late April.

Investigations into the grounding and Shell’s 2013 Alaska Arctic drilling season by the U.S. Coast Guard; the U.S. Department of the Interior; the U.S. Senate Subcommittee on Oceans, Atmosphere, Fisheries and Coast Guard; and possibly the U.S. House Committee on Natural Resources, will begin within a few weeks. No precise information on any of these has yet been released, although the Interior Department’s 60-day review period of Shell’s Alaska operations ends on March 7th.

This story may be updated later Tuesday.

Photo by USCG PO 3rd Class Jonathan Klinginberg

Cost to Shell of Kulluk Grounding? $90 Million and Counting ….

1:38 pm in Uncategorized by EdwardTeller

Shell arctic drilling deployment scheme

Thursday, at Shell Oil’s annual Results Conference in London, Shell CEO Peter Voser delivered a prepared address on the company’s global performance during 2012.  It included little information about the energy giant’s 2012 Alaska Arctic drilling season fiascos we don’t already know:

“Despite making some progress we have run into problems in the last few months. Our rigs will need more work if they are going to be ready for the 2013 drilling season. One, the Noble Discoverer needs a series of upgrades, and the other, the Kulluk, ran aground in a heavy storm on New Year’s Eve and has been damaged.”

After the address, though, Vosser answered questions from the press.  His answers provided some new information.  Questioned on whether or not Shell had decided to move the rigs when they did to avoid paying millions in Alaska taxes, Vosser tried to wriggle out from under previous statements and information available through Shell officials in Alaska:

Tim Webb, the energy editor at The Times in London, asked Voser if Shell was moving the rig from Unalaska to Seattle in order to evade Alaska’s oil and gas property tax.

“Assuming you say that’s true, because I think that came from Shell, would you say that’s an example of Shell not managing risks correctly, or making a poor decision in terms of managing risk in Alaska?”

In response, Voser denied that the decision to move the rig had anything to do with taxes, saying that the $5-6 million they would have had to pay is nothing in the grand scheme of things.

“There was a statement made by a Shell person, but in a completely different context, in a completely different meeting. That was then taken out of that context and then someone made a story out it. Just to be very clear on this one.”

The original story was written by Dutch Harbor Fisherman reporter Jim Paulin. In it, he quoted an email from Shell spokesperson Curtis Smith that was sent before the grounding. Paulin says he stands by his reporting.

“And I don’t think Shell would be backing away from that comment had it not gone aground. I think they would have been sending lobbyists to Juneau to try to repeal that tax. And I think that would be, in my opinion, the motivation for making that comment that it influenced their decision to move it.”

Reporter Paulin’s statement about Shell lobbyists in Juneau is, if anything, understatement.  During the same day Shell CEO Vosser  was delivering his annual report, in Juneau, the oil industry was flexing its muscle as it only can in Alaska.

The 2012 election brought an end to a Senate bipartisan coalition that dated back to shortly after the FBI busted a number of Alaska legislators for taking bribes from the major oil field service company in Alaska, Veco.  Although it was understood at the time that Veco’s bribers were working on behalf of oil giant ConocoPhillips, no employees from the latter were ever indicted by the Justice Department.  The crooked legislators smugly called themselves “The Corrupt Bastards Club,” and even had baseball caps made with the term plastered across them.

Replacing the bipartisan Senate coalition is a new GOP-run super majority that is intent on ramming through Senate Bill 21, which will repeal the most important element of Alaska’s taxation of oil fields here, and strip billions of dollars per year from state coffers and give it to immensely wealthy oil companies, like ConocoPhillips, British Petroleum and Exxon-Mobil.

Tuesday through Thursday, the Senate Special Committee on TAPS [Trans-Alaska Pipeline System] Throughput held telephonic hearings across the state on SB 21.  About 90% of the testimony was in favor of not implementing SB 21, or of even tweaking our tax rate on the oil industry, which is at the bottom of the middle of the pack worldwide.
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