Royal Dutch Shell Plans To Resume Arctic Drilling (NYSE:RDS.A)

Drilling for oil in the Arctic waters off Alaska is set to resume as Royal Dutch Shell has submitted new plans for the operation. The plan submitted to the federal government outlines how Shell intends to explore for oil in the Chukchi Sea region.

Submitting the filing with the Interior Department was the first step in restarting operations in the Arctic region. The drilling efforts were previously halted due to legal setbacks and logistical problems. The company could resume drilling as soon as next summer.

Drilling in the Arctic is fraught with unique problems that can be difficult to solve. The Arctic has almost no sunlight in the winter months due to the tilt of the earth. There are also free-floating ice floes that can damage equipment.

There have been a number of accidents involving Shell’s ships and support equipment in the Arctic region. In December of 2012, the company had a drilling rig run aground during a storm.

Nevertheless, the oil industry sees great potential in the Arctic waters off the coast of Alaska. If Shell’s efforts are successful, their site could be producing more than 400,000 barrels of oil a day. Two rigs would operate simultaneously drilling in separate areas of the sea.

Unsurprisingly, the drilling plans have been loudly denounced by environmentalists concerned about the health of the region. The environmentalists are also concerned about the effects that the drilling would have on threatened wildlife species with habitat in the area, like polar bears.

Opposition to the arctic drilling has become increasingly vocal in recent months. If Shell’s latest plan receives government approval, several environmental groups, including the Center for Biological Diversity and Earthjustice, plan to issue court challenges to oppose the resumption of drilling.