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An unpowered drill rig, the Kulluk, owned Shell Oil has run aground on Kodiak Island. It was being towed to Seattle, ostensibly for maintenance, during a predicted storm of 40 foot high waves and 50 knots when tow lines snapped.

Which raises an interesting question: why tow anything in the middle of a massive hurricane-strength storm in the dead of winter? After all, Shell concluded its drilling season on October 31. House Democrats want to know why Shell was so desperate to move the Kulluk during the same storm that grounded the boats of the reality show America's Deadliest Catch.

The answer appears to be a tax dodge. Yes, the company that spends millions defending its tax breaks hoped to save on taxes it would owe to the state of Alaska. The Alaska Dispatch reports on Shell's hope to save millions:

A Shell spokesman last week confirmed an Unalaska elected official’s claim that the Dec. 21 departure of the Kulluk from Unalaska/Dutch Harbor involved taxation.

City councilor David Gregory said Shell would pay between $6 million and $7 million in state taxes if the Kulluk was still in Alaska on Jan. 1.

Shannyn Moore, "just a girl from Homer," reports (on her podcast beginning at 14:44) that Dutch Harbor charges $13.35 per $1,000 of assessed value on both real and personal property.

So far, the "very large and complex" Kulluk joint command consists of the U.S. Coast Guard (USCG), Alaska Department of Environmental Conservation (DEC), Shell, Noble Drilling Contractor, and Kodiak Island Borough. They've involved 500 personnel. Two boats have sunk, 18 people at risk have been evacuated in very rough weather, and flyovers/salvage operations to check for leaks seem to be just beginning. All of these resources are being brought in to protect the right of Shell Oil to skimp on state taxes. All of these resources will enable Shell to, next summer, drill where its leak containment dome was crushed like a beer can in simple tests. In short, the Kulluk socializes the risks while Shell privatizes the profits and the Obama administration stands by offshore oil plans.

One of the wild-eyed radical environmentalists at Forbes suggests the obvious: Shell should cut its losses and leave the Arctic alone. But not until after it repays the United States and the State of Alaska for all the taxpayer money being spent in its latest fiasco.

Originally posted to Climate Hawks on Thu Jan 03, 2013 at 08:29 PM PST.

Also republished by Gulf Watchers Group and Community Spotlight.

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