Lease Signed: Port of Seattle Will Host Shell's Arctic Drilling Fleet
The CEO of the Port of Seattle has signed a lease agreement that will allow the Shell Oil Company to base part of its Arctic drilling fleet in West Seattle despite the threat of a lawsuit from a coalition of environmental groups.
The lease agreement is with Seattle’s Foss Maritime, which will pay the port more than half a million dollars a month for two years, or more than $13 million total, with options to extend through 2018. The lease is for 50 acres (about a third) of Terminal 5, which is currently empty. The Port is working on upgrades and sought temporary tenants while it designs the improvements.
In a letter responding to the environmentalists' concerns, CEO Ted Frick said Foss provided the only suitable proposal among 40 identified by port staff.
Paul Queary, a spokesman for Foss, said it’s a win-win for Seattle.
“The Arctic drilling operation is obviously a time-limited operation. The port was looking for a tenant that would provide some revenue for the terminal while they’re redeveloping it to accommodate the larger container vessels," Query said. "And so it’s a good deal for Foss and it’s a good deal for the port and for the taxpayers that support the port."
The Port of Seattle has argued the lease does not require environmental review under state law, because it contends the interim use represents no change from the use of the previous tenant.
A broad coalition of environmental groups disagrees and is considering all legal options to stop the lease from going through.
KC Golden, a senior policy advisor at Climate Solutions, said he was shocked to hear the port was even considering hosting Shell, especially the Artic drilling fleet, and in 2015, a year when a major breakthrough is expected on international climate agreements to reduce greenhouse gas emissions.
“Seattle has been an outspoken leader in terms of walking the talk as a city and calling for action at higher levels of government to address this problem. And this lease just flies in the face of all of that,” Golden said.
Golden said port commissioners should have made a formal decision on the lease with more public involvement.
Because it is temporary, the deal was not subject to a formal vote by the commissioners. After a briefing last month, they voted 3 to 2 to allow staff to proceed with it. The lease was signed by the Port’s CEO on Monday.
Among the Shell vessels that will be based in Seattle are two oil rigs: the Polar Pioneer and the Noble Discoverer. They’re expected to arrive in April or May.