UK the focus of offshore decommissioning in years ahead, report finds

Offshore staff

ST ANDREWS, UK – Oil & Gas UK has unveiled two new decommissioning reports at a conference jointly organized with Decom North Sea.

The eighth edition ofDecommissioning Insight is designed to help suppliers gauge demand for their services between now and 2025.

Key findings include:

• From 2017 to 2025, decommissioning is set to occur on 349 fields across theNorth Sea, comprising six fields in the Danish sector; 23 offshore Norway; 106 offshore the Netherlands; and 214 in UK waters.

Infrastructure scheduled for decommissioning includes:

• More than 200 platforms - complete or partial removal

• Around 2,500 wells to be P&A’d

• Close to 7,800 km (4,846 mi) of pipelines.

The UK will provide the largest market with decommissioning, as a proportion of total UKCS expenditure rising from 2% in 2010 to 7% in 2016, when the market was valued at £1.2 billion ($1.6 billion).

This year, the forecast total is £1.8 billion ($2.4 billion): during 2017-25, the forecast UK decommissioning spend will likely total £17 billion ($22.8 billion).

Around 46% of the total UK spend during this period will be concentrated on the central North Sea, while well P&A represents the largest item of expenditure at 49%.

Elsewhere, the forecast near-term expenditure is £400-800 million/yr ($536 million-$1.07 billion) on the Norwegian continental shelf, and £650-800 million/yr ($871 million-$1.07 billion) on the Dutch continental shelf.

Oil & Gas UK’s Mike Tholen said: “With industry driving efficiency improvements which have led to a 16% increase in UKCS production following a decade of decline, the sector is successfully controlling the cost of well plugging and abandonment.

The Insight reveals that the average forecast cost for well P&A has fallen by 5% in the central and northern North Sea and west of Shetland, and by 4% in the southern North Sea and Irish Sea with further cost reductions predicted…”

Lessons learned from decommissioning projects since 2012 are highlighted in the Steel Piled Jacket in the North Sea region report.

This details experience gained from 63 projects decommissioned to date, including progress in health and safety, environment and technology, including cutting and lifting solutions.

11/29/2017