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Fossil Firms Should Consider Arctic Drilling Risks, IEA Chief Advises

Geological and technological limits and rising extraction costs make Arctic oil and gas drilling a risky endeavour from a purely business-oriented perspective, International Energy Agency Executive Director Fatih Birol told The Guardian last Friday.

https://en.wikipedia.org/wiki/Barents_Sea [1]

Wikipedia [2]

“It’s geologically difficult, technologically difficult, lots of environmental challenges, and the cost of production is very, very high, especially if you look at the current oil price levels,” said Birol, who served as the IEA’s chief economist before taking the helm of the agency. “Arctic oil is not for today, and not for tomorrow—maybe for the day after tomorrow.”

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While he didn’t endorse calls for a ban on Arctic drilling, Birol urged fossil companies to be careful about assessing new ventures. “The companies should look at all these risks combined,” he said. “It is up to them to make or lose money.”

Lazare notes that “Shell’s Arctic drilling bid has been met with fierce protest [4] and direct actions [5], but despite these efforts, the oil giant is currently moving forward with plans for exploratory drilling. Earlier this week, Shell’s chief executive Ben van Beurden told BBC that he does not expect to begin commercial drilling until at least 2020.”

She cites Bill Snape, senior counsel with the U.S. Center for Biodiversity: “When a U.S. permittee is admitting they are still half a decade away from commercial drilling, you have to wonder from an environmental point of view why we are entertaining this folly at all.”