SEPTEMBER 11, 2013 — Shell has just had to add another $1.1 million to the costs of its 2012 Alaska drilling program.

Shell Gulf of Mexico, Inc. and Shell Offshore, Inc. last week reached settlements with the U.S. Environmental Protection Agency for violations of their Clean Air Act permits for arctic oil and gas exploration drilling in the Chukchi and Beaufort Seas, off the North Slope of Alaska.

Kulluk

Based on EPA’s inspections and Shell’s excess emission reports, EPA documented numerous air permit violations for Shell’s Discoverer and Kulluk drillship fleets, during the approximately two months the vessels operated during the 2012 drilling season.

In the settlements, Shell has agreed to pay a $710,000 penalty for violations of the Discoverer air permit and a $390,000 penalty for violations of the Kulluk air permit.

EPA issued the Clean Air Act Outer Continental Shelf permits for Shell’s operations in early 2012. The permits set emission limits, pollution control requirements, and monitoring, recordkeeping, and reporting requirements on the vessels and their support fleets of icebreakers, spill response vessels, and supply ships.

In January 2013, EPA issued violation notices for Shell’s Discoverer and Kulluk air permits. Shell did not operate in 2013 under the air permits.