Shell Gives Up Plan to Find Oil in Alaska This Year image

Today, September 17th, Royal Dutch Shell PLC announced that due to several setbacks it will no longer seek oil in Alaska this year.

Shell has spent more than $4.5 billion to get licenses and prepare to make exploratory drilling in the Beaufort and Chukchi Seas. Now the company announced it will postpone its plan until next summer, after one of its containment systems failed during a test. The company delayed drilling previously because of ice floe movements.

After a containment dome designed to cap a spill was damaged, Shell realized that the time needed to fix the problem will make it impossible for the company to be able to find oil this year. Shell said that by the end of this season it still plans to drill several shallow top holes, which will be further pursued in the following years.

Shell has fought a long battle against environmental groups, who opposed drilling in icy waters to seek oil, claiming it is too risky. After Shell announced its plan delay, Greenpeace called the company’s program a “monumentally reckless gamble.”

“Investors must now be asking whether investing such vast sums of money trying to exploit the fragile Arctic is really worth it,” said Ben Ayliffe, head of Greenpeace’s campaign to stop Shell.