Shell Alaska announced Thursday the company wouldn't proceed with any Chukchi Sea drilling operations this year, meaning hundreds of Alaskans will no longer have jobs with the project.
Shell Alaska Vice President Pete Slaiby told Channel 2 News the decision, made by the oil company's parent Royal Dutch Shell, had everything to do with the 9th Circuit Court's recent ruling that federal regulators conducted inadequate environmental studies before granting petroleum leases off Alaska's northwest coast.
"It basically meant moving forward in 2014 became far too uncertain for us to proceed," Slaiby said.
Slaiby said the decision could put hundreds of Alaskans out of jobs with the project.
"In 2012, we put about 2,000 people to work in the operational end of the business during the open water season, and about 800 of those were Alaskans," Slaiby said.
City of Barrow Mayor Bob Harcharek said he has mixed feelings about the decision.
"If oil were extracted and they found it and extracted it, it would mean more income to the community in the form of just infrastructure development, more jobs," Harcharek said.
But he said many residents in the area have reservations about offshore drilling.
"If they could drill oil carefully, (and) they could guarantee spills would be cleaned up, I think they would win over more people," Harcharek said.
Locals in Point Lay say they want to make sure their subsistence lifestyle is protected.
Misty Plymale, who has lived in the community of about 300 residents for two years, said she's worried about the fragile ocean that provides necessary food to her community.
"Essentially, the ocean is our grocery store and the longer they stay out of the ocean, the longer we'll have our subsistence use animals," Plymale said.
Lena Ferreira has spent more than 20 years in Point La, and said she's concerned the oil company hasn't demonstrated that it knows how to handle a spill situation.
"I'm happy they're not going to be drilling, we can have a bigger loss than … if anything happens in the Chukchi Sea," Ferreira said. "I mean, do they know how to clean oil out from the ice?"
While offshore drilling plans are put on hold for now, Shell said it's optimistic about the future.
"I think there's a lot of uncertainty about moving forward, so we remain optimistic about the geological prospect, but this is and continues to be very, very difficult, to get certainty… on the permits," Slaiby said.
Shell said it's going to work with the Department of the Interior about the permitting process. It's not yet known what will happen in 2015.