Less than a week after Shell announced that it would be abandoning its Arctic oil drilling project in the Chukchi Sea, Italian oil company Eni has come forward saying their own plan to dig for oil in the Norwegian Arctic has got the full green light.
Eni’s Goliat project, as they have named it, is set to be the northernmost offshore oil project in the world and, if all goes according to plan, it will be pumping out 100,000 barrels of oil every single day. Eni estimate that in the reserves there hold around 8 billion cubic metres of gas and a good 175 million barrels worth of oil.
A Tricky Journey
The road to completion is almost over but it has not been a smooth one. Indeed the Goliat project has taken two years longer to get to this stage than was initially intended, and has cost an extra £1.1 billion. It’s been something of an interesting journey as well. Shell’s manoeuvre into the Arctic drew a huge amount of media attention and induced uproar from environmentalist groups such as Greenpeace, who were elated at the news that the project had been abandoned, even if there has been some dispute as to the exact reason why Shell pulled out. Ostensibly, Shell pulled out of what they realised was to be an ineffective project – there simply wasn’t enough oil to make it worth their while; Greenpeace activists maintain though that behind-closed-doors apprehension given the huge level of protest action was to thank.
Either way, Eni have managed to slip comfortably under the radar as they set up their project, sailing the huge rig from Korea to Norway on a 63-day voyage that took it right past the UK without really being noticed by, well, anyone who didn’t know it was already happening.
“There is still some work to do”
Work on getting the 64,000 tonne offshore platform fully functional is now at its final stages. The wells are drilled and the platform itself is in place; one of the only things holding the project back currently is the wait for approval from the Norwegian government. A spokesman for the Petroleum Safety Authority in the Scandinavian country said that “there is still some work left to do at Goliat.”
Once it goes ahead, Goliat will be a landmark for the industry, marking the first proper, successful, Arctic oil drilling project though spokespeople for Eni have been keen to maintain that the area in which they are drilling is the “manageable Arctic”, where the terrain and ocean remains, for the most part, ice-fee.
They have also made sure to make it clear that all of the relevant preparations have been put in place, and that the rig is “fully winterised” to the point where it will have no trouble whatsoever functioning in hostile conditions and could even withstand the intense storm conditions that hit the Barents Sea every century or so.
Eni have not been free of environmentalist criticism for their Goliat project. The leader of Greenpeace Norway, Truls Gulowsen, has spoken out against the project for the same broad reasons as applied to Shell, saying that “We know we need to keep 90% of proven fossil reserves in the ground so a good place to start would be one of the most precious, pristine and vulnerable areas of nature we still have.”
Interestingly though, Gulowsen also pointed to the economic issues with the Goliat project, pointing out that in order for Eni to just break even from the project, they need oil prices to increase to more than twice what they are right now.
“It is our opinion” said Gulowsen, “that Goliat will remain a symbol of abject failure for years to come. From a purely economical standpoint the project is already a disaster.”