Overnight Energy: Drillers abandoning Arctic leases

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Overnight Energy: Drillers abandoning Arctic leases

[ http://thehill.com/policy/energy-enviro ... ing-rights ]

By Timothy Cama and Devin Henry - 10/05/16 05:39 PM EDT

Major oil companies have abandoned hundreds of leases for offshore drilling rights in the United States's portion of the Arctic Ocean.

Federal government documents obtained by environmental group Oceana show that ConocoPhillips Co., Italy’s Eni and Iona Energy, Inc., abandoned all their leases in the Chukchi Sea, to the north and west of Alaska.

Royal Dutch Shell has abandoned numerous leases and said it plans to relinquish all but one.

Oil companies have, in total, abandoned 2.2 million acres of Arctic drilling rights, Oceana said, and 80 percent of all area in the American Arctic leased in a 2008 sale has been or will be abandoned.

For Shell and ConocoPhillips, the decisions came just before a May 1 deadline to pay millions of dollars to keep its leases active.

Shell spokesman Curtis Smith confirmed Oceana’s account, saying the decision came “after extensive consideration and evaluation.”

Shell spent about $2.5 billion over seven years in preparation to drill a single exploratory well last summer in the Chukchi following a disastrous attempt in 2012.

It concluded after drilling that the exploration was not worth the costs of drilling in the remote area, so it decided to abandon Arctic drilling for the foreseeable future.

Statoil, Total, EnCana and Armstrong have also given up Chukchi leases, Oceana found.

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