Royal Dutch Shell Plc’ share price up, asks the Obama administration for five-year extension for its Arctic oil drilling project

Royal Dutch Shell Plc, which has spent eight years and invested $6 billion in oil search in the Arctic’s Beaufort and Chukchi seas, is asking the Obama administration to provide it with five more years for oil exploitation of the Alaskas coast. The company also said that difficulties and legal delays may push the drilling process start past the expiration date in 2017.

The Vice president of the Shells division in Alaska, Peter Slaiby, wrote in a letter to the regional office of the Bureau of Safety and Environmental Enforcement, cited by Bloomberg: “Despite Shell’s best efforts and demonstrated diligence, circumstances beyond Shell’s control have prevented, and are continuing to prevent, Shell from completing even the first exploration well in either area.”

The negotiations of Shell with the U.S. Department started two years ago and now the company announced that the regulatory authorities were considering its request. The leases located in the Beaufort Sea are the first ones that are scheduled to expire in 2015. They cost Shell a total of $2.2 billion, but if the U.S. administration is not to change its decision, they will become worthless over the next several years.

The plans of the U.K.-based company to produce oil in the Arctic involved a drilling rig and spill containment system. However, Shell faced some difficulties, because several environmental groups had sued it in attempts to block the exploration of the region. These setbacks made the company halt its operations in 2012 and invest money in repairing equipment. Shell has still not resumed its maritime operations off the northern coast of Alaska.

The U.S. administration was asked by the deputy Vice-President at Oceana, Susan Murray, to reject Shells call for lease extensions. As reported by the Financial Times, she said: “Shell spent billions of dollars fully aware of the risks to that investment, and the government should not bend the rules to allow the company to continue business as usual.” Ms. Murray also added that the U.K.-based company “has a track record of irresponsible choices that warrants close scrutiny and the highest standards.”

Royal Dutch Shell Plc added 0.30% to trade at GBX 2 189.5 per share as of 9:26 GMT, marking a one-year increase of 2.46%. The company is valued at €178.66 billion.