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Drifting Shell drill ship grounds on rocks off Alaska

By Yereth Rosen

ANCHORAGE, Alaska (Reuters) - A large drill ship belonging to oil major Shell ran aground off Alaska on Monday night after drifting in stormy weather, company and government officials said.

The ship, the Kulluk, broke away from one of its tow lines on Monday afternoon and was driven to rocks just off Kodiak Island, where it grounded at about 9 p.m. Alaska time, officials said.

The 18-member crew had been evacuated by the Coast Guard late Saturday because of risks from the storm.

With winds reported at up to 60 miles an hour and Gulf of Alaska seas of up to 35 feet, responders were unable to keep the ship from grounding, said Coast Guard Commander Shane Montoya, the leader of the incident command team.

"We are now entering into the salvage and possible spill-response phase of this event," Montoya told a news conference late on Monday night in Anchorage.

There were three minor injuries to people responding to the incident but all personnel have returned to duty.

There is no known spill and no reports of damage yet and a U.S. Coast Guard helicopter overflight conducted shortly after the grounding detected no visible sheen.

A spokeswoman for the command team said it would do another overflight during daylight on Tuesday, weather permitting.

The Kulluk has about 139,000 gallons of ultra-low-sulfur diesel on board, and equipment on the Kulluk is estimated to have about 12,000 gallons of combined lube oil and hydraulic fluid.

The grounding of the Kulluk, a conical, Arctic-class drill ship weighing nearly 28,000 gross tons, is a blow to Shell's $4.5 billion offshore program in Alaska.

Shell's plan to convert the area into a major new oil frontier has alarmed environmentalists and many Alaska Natives, but excited industry supporters.

Environmentalists and Native opponents say the drilling program threatens a fragile region that is already being battered by rapid climate change.

"Shell and its contractors are no match for Alaska's weather and sea conditions either during drilling operations or during transit," Lois Epstein, Arctic program director for The Wilderness Society, said in an email.

"Shell's costly drilling experiment in the Arctic Ocean needs to be stopped by the federal government or by Shell itself given the unacceptably high risks it poses to both humans and the environment," she added.

The nearest town is Old Harbor, located on the opposite side of Kodiak Island from where the Kulluk is grounded. Old Harbor is a Native Alutiiq village with 208 residents.

The leading Democrat on the U.S. House of Representatives' Natural Resources Committee, Ed Markey, of Massachusetts, said in a statement that this incident and others illustrated the perils of oil drilling in the Arctic.

"Oil companies cannot currently drill safely in the foreboding conditions of the Arctic, and drilling expansion could prove disastrous for this sensitive environment," he said.

BEDEVILLED

The Kulluk's woes began on Friday, when the Shell ship towing it south experienced a mechanical failure and lost its connection to the drill vessel.

That ship, the Aivik, was reattached to the Kulluk early on Monday morning, as was a tug sent to the scene by the operator of the Trans Alaska Pipeline System. But the Aivik lost its link Monday afternoon, and the tug's crew could only try to guide the drill ship to a position where, if it grounded, "it would have the least amount of impact to the environment," Montoya said.

The tug Alert intentionally disconnected about 30 minutes before the ground for the protection of the nine crew members aboard the tug.

The Kulluk was used by Shell in September and October to drill a prospect in the Beaufort Sea. It was being taken to Seattle for the off season when the problems began on Friday.

Susan Childs, emergency incident commander for Shell, held out hope that a significant spill from the drill ship was unlikely.

"The unique design of the Kulluk means the diesel fuel tanks are isolated in the center in the vessel and encased in very heavy steel," she told the news conference.

Shell is waiting for weather to moderate "to begin a complete assessment of the Kulluk," she said. "We hope to ultimately recover the Kulluk with minimal or no damage to the environment."

The Kulluk was built in 1983 and had been slated to be scrapped before Shell bought it in 2005. The company has spent $292 million since then to upgrade the vessel.

Shell's Arctic campaign has been bedeviled by problems. A second drill ship, the Discoverer, was briefly detained in December by the Coast Guard in Seward, Alaska, because of safety concerns. A mandatory oil-containment barge, the Arctic Challenger, failed for months to meet Coast Guard requirements for seaworthiness and a ship mishap resulted in damage to a critical piece of equipment intended to cap a blown well.

(Additional reporting by Phil Wahba in New York; Editing by Patrick Graham and James Dalgleish)

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