Big oil abandons US$2.5 billion in U.S. Arctic drilling rights after crude prices plummet

, Crisis

The U.S. Arctic is estimated to hold 27 billion barrels of oil and 132 trillion cubic feet of natural gas, but energy companies have struggled to tap resources.

After plunking down more than US$2.5 billion for drilling rights in U.S. Arctic waters, Royal Dutch Shell, ConocoPhillips and other companies have quietly relinquished claims they once hoped would net the next big oil discovery.

The pullout comes as crude oil prices have plummeted to less than half their June 2014 levels, forcing oil companies to slash spending. For Shell and ConocoPhillips, the decision to abandon Arctic acreage was formalized just before a May 1 due date to pay the U.S. government millions of dollars in rent to keep holdings in the Chukchi Sea north of Alaska.

The U.S. Arctic is estimated to hold 27 billion barrels of oil and 132 trillion cubic feet of natural gas, but energy companies have struggled to tap resources buried below icy waters at the top of the globe.

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One Comments

  • profissoes novas 08 / 04 / 2017 Reply

    Hmm is anyone else having problems with the pictures on this blog loading?
    I’m trying to determine if its a problem on my end or if it’s the blog.
    Any responses would be greatly appreciated.

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