Oil giant BP said yesterday it had indefinitely suspended its £968million Liberty offshore oil project in Alaska because of cost overruns and technical setbacks.
Under plans submitted five years ago to regulators, Liberty would have been the first oil field located entirely in federal waters offshore Alaska. At the time, BP expected production to begin last year.
Dawn Patience, of BP Exploration (Alaska), said that following an 18-month review, the firm had concluded the Liberty project, a field with about 100million barrels of recoverable oil, should not go forward as planned.
She said the review found the field would have cost a lot more than the £968million BP had budgeted to spend there and would have taken several additional years to begin production.
A US Bureau of Ocean Energy Management spokesman said BP had informed federal regulators it was seeking to redesign the development.
BP’s setback comes as a coalition of environmental groups has said it plans to file a federal lawsuit seeking to overturn approvals for Shell’s planned exploration drilling in Arctic waters off Alaska.
The lawsuit will seek to overturn approvals of Shell’s oilspill plans granted earlier this year in the hope of stopping drilling in the Beaufort Sea and Chukchi Sea later this summer.
Most of a 22-vessel fleet Shell has mobilised for the drilling campaign is en route to Alaska. Shell had expected to start drilling this month, but a spokesman said last week it now expected it to begin in early August.
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