Shell Pulls the Plug on Offshore Drilling in Alaska

After recently announcing that it is halting investment resources and development of algal biofuels oil giant Royal Dutch Shell (NYSE: RDS.A) has suspended another set of company operations: offshore drilling in Alaska.

Shell cited unclear federal policy and permitting delays as the main reason for pulling the plug on exploratory drilling in Alaska. Shell's CEO Peter Voser said that the company was not willing to invest the US$100 million to US$150 million to continue the 2011 project given there was a chance it would not be granted the permits required to begin drilling operations.

This comes just a day after Shell reported 2010 profits that doubled the company's 2009 numbers.  Despite showing profit gains from US$9.8 billion in 2009 to US$18.6 billion in 2010 Voser said that there "were still more" progress to be made.  Shell plans on revisiting the Alaska offshore drilling project until 2012.

“Despite our investment in acreage and technology and our work with the stakeholders, we haven’t been able to drill a single exploration well,” said Voser.

He continued, “Critical permits continue to be delayed and the timeline for getting these permits is still uncertain.”

Image Credit: zieak via Flickr.