Oil lobby confronts image problem in Arctic drilling

by Timothy Cama - 06/12/15 7:39 PM ET

The oil industry has identified public perception as one of the top issues it faces as it seeks to drill in the Arctic Ocean.

American Petroleum Institute (API) officials said that throughout the world in places like Canada and Russia, oil drillers have a century of experience operating in Arctic conditions, and they are not worried about their ability to drill north of Alaska.

But convincing the public of those qualifications is proving a challenge.

{mosads}“We need to secure public confidence,” Richard Ranger, a senior advisor at API who oversees Arctic drilling policy for the group, told reporters Friday.

“There’s obviously a significant debate, and we recognize the fact that the idea that we can operate safely and have operated safely in the Arctic is as not broadly realized across the public as we think it should be,” he said.

As oil producers eye the largest untapped hydrocarbon resource in the world, where the federal government estimates up to 36 billion barrels of oil and 137 trillion cubic feet of natural gas sit, it’s important the industry gets its ducks in a row.

Royal Dutch Shell is preparing to drill exploratory wells in northwest of Alaska in the Chukchi Sea this summer, though other companies like ConocoPhillips Co. and Statoil hold leases there as well, and more lease sales are likely in the coming years.

The industry is trying to explain to the public that it is safe and that environmental damage is rare, but it’s a difficult task, Ranger said.

“Our challenge as an industry and as people who work in the industry is, it’s too easy for us to default to technical arguments, and people’s eyes simply glaze over,” he said.

It doesn’t help the industry that news travels so fast and happens at all hours of the day, making relatively small spills into national news.

“There’s a network of information transfer, which means we operate in a fishbowl,” Ranger lamented.

The Obama administration approved Shell’s drilling plan in May, eliciting widespread condemnation from environmentalists who say drilling in the harsh, delicate Arctic is nearly impossible to do safely.

“Once again, our government has rushed to approve risky and ill-conceived exploration in one of the most remote and important places on Earth,” Susan Murray, deputy vice president for the Pacific at the group Oceana, said at the time.

“No company deserves a license to despoil our last pristine ocean and spew massive amounts of carbon pollution into our atmosphere,” said Franz Matzner, director of the Natural Resources Defense Council’s Beyond Oil initiative.

API believes a focus on educating the public and policymakers is the key to gaining support for Arctic drilling.

“We’ve had experience, in North America, drilling those types of wells with success,” API Upstream Director Erik Milito said, pointing to successful projects in Canada.

Shell’s abortive 2012 drilling quest, for which it received tongue lashings from various federal agencies after its drilling rig ran aground on an island, is driving much of the opposition, but the industry is pushing back.

API officials refused to get into the details of Shell’s operations, but they said it’s no reason to doubt the industry’s safety and qualifications.

“When you have an incident, you don’t stop. You move forward,” Milito said. He cited the 2010 Deepwater Horizon spill at a BP well in the Gulf of Mexico as an example, saying the industry has improved since.

“You just keep moving, and through the course of moving and being allowed to continue to operate, you build the confidence back up. Fortunately, whatever’s happened in the past couple of years in Alaska hasn’t resulted in any kind of environmental damage,” he said.

“Whatever happened up there, I hope everybody’s learned from it,” Milito continued. “I think if the public sees that we’ve learned from our mistakes and we’re making improvements on them, that’s how we get the confidence.”

And Ranger defended Shell’s drilling, saying the grounding incident wasn’t related to the drilling operation itself.

“The drilling activities proceeded safely and have been acknowledged as such,” he said.