Royal Dutch Shell says it has finally run out of time to put together an Arctic offshore drilling program for the Beaufort Sea this summer, answering the question that for months has been at the center of economic concerns, political drama and legal action.

After a lawsuit brought by environmental groups and Native organizations dashed its hopes to explore leases it owned in the Chukchi Sea, Shell turned its attention to the Beaufort Sea as the path of least resistance on the part of government regulators and opponents of offshore exploration. In October, Shell applied for a permit to sink at least one exploratory well in Camden Bay, near Kaktovik. In a recent letter to the federal Bureau of Ocean Energy Management, Regulation and Enforcement, Shell had said it needed to have some confidence permit issues would be resolved by Jan. 31 in order to get its drilling plans in place for work this summer.

On Tuesday, Shell officials announced time had in essence run out and that the company had decided not to proceed with a drilling program this summer in the Beaufort Sea.

"Shell is ready to drill," Shell's Alaska president Pete Slaiby told a gathering of reporters that included local press as well as representatives from media outlets through the country.

"Despite our efforts critical permits continue to be delayed," he added.

The main hang up is an air quality permit that the company had obtained several years ago for work in both the Chukchi and Beaufort Seas. But last month the permit was invalidated by the Environmental Appeals Board, a part of the U.S. Environmental Protection Agency, after a legal challenge by Native groups with help from environmental organizations.

Slaiby said Shell has been working well with the BOEMRE on its drilling permit and is "guardedly optimistic" that the drilling permit will be issued this year.

But, he said, the company did not have as good a feeling about what was going on with the air quality permit and what EPA must do to resolve concerns that the appeals board ordered it to reconsider.

"We're pretty optimistic about 2012" and being able to drill then, he said.

Slaiby pointed out that the summer drilling season is only about 105 days so the company must gear up to catch that window, including moving drilling and oil spill response equipment into place.

Gov. Sean Parnell and others lashed out at the Obama administration on Thursday, saying the inability of Shell to get a permit for work this year was more evidence that the Obama administration simply does not want Arctic drilling.

But Slaiby said Shell feels "largely positive" that the Obama administration does want to move forward with Arctic offshore exploration and that "there is some past understanding that Alaska offshore will play a role in us energy future."

"That's been brought home in the last few days," he said referring to the political turmoil in Egypt and elsewhere in the Middle East that is causing concern over the U.S. dependence on foreign oil.

"The sense we're getting from this administration is more positive in order to get to a landing point on Arctic policy" and Shell's program in particular, Slaiby said.

Shell has held leases in the Beaufort and Chukchi seas for five years and has spent more than $3 billion to get to this point, Slaiby said, adding the company has put in place an "unprecedented" oil spill response plan and has accumulated "a huge amount of broad scientific studies to support our exploration plan."

He estimated that about 800 jobs will be lost this summer without the exploration program and that a number of contractors, including Native corporations, will lose millions of dollars in work.

Parnell told reporters at a press conference in Juneau Thursday morning that he was "extremely disappointed" in the situation and pointed to the loss of jobs as a primary setback. Parnell, along with Slaiby, said work in the Arctic offshore is projected to eventually amount to about 35,000 jobs in Alaska.

Parnell blamed the federal government's inability to more rapidly process permit applications. "It's unfathomable that a company buys federal leases and can't get on them in four to five years' time," he said.

"Egypt is burning right now and we're dependent on Middle East oil," the governor said. "Why not become more dependent on domestic oil?"