Send your latest releases to

Two new reports to boost decommissioning intelligence

Published:  30 November, 2017

An insight into how the North Sea decommissioning market will take shape over the next nine years was one of two key guides launched on Tuesday, 28 November at a major decommissioning conference organised by Oil & Gas UK and Decom North Sea.

An up-to-date overview of the decommissioning of offshore structures, known as steel piled jackets, was also released at the St Andrews event, which attracted around 500 delegates.

Speaking at the two-day conference, sponsored by Aberdeen Harbour Board, Oil & Gas UK’s upstream policy director, Mike Tholen, said:

“Now in its eighth year, we’ve broadened the scope of the 2017 issue of our popular Decommissioning Insight so that it now includes decommissioning activities off Norway, Denmark and the Netherlands as well as those on the UK Continental Shelf (UKCS).

“This additional information will help the supply chain better understand the demand for their service and expertise from now until 2025.

Key findings of the 2017 Decommissioning Insight include:

• From 2017 to 2025, decommissioning is forecast to take place on 349 fields across the four regions of the

North Sea:

• Six fields on the Danish Continental Shelf

• 23 fields on the Norwegian Continental Shelf

• 106 fields on the Dutch Continental Shelf

• 214 fields on the UKCS

And across these regions, the infrastructure scheduled for decommissioning includes:

• Over 200 platforms are forecast for complete or partial removal

• Close to 2,500 wells are expected to be plugged and abandoned

• Nearly 7,800 kilometres of pipeline are forecast to be decommissioned

When set against this wider context, the forecast for the UK reveals it is the largest market with decommissioning, as a proportion of total UKCS expenditure, increasing from 2 per cent in 2010 to 7 per cent in 2016, when the market was worth £1.2 billion. Operators forecast this figure will rise to 11 per cent (£1.8 billion) this year.

• From 2017 to 2025, £17 billion is forecast to be spent on decommissioning on the UKCS.

• Annual expenditure on the UKCS is forecast to remain consistent over the near term at £1.7- £2 billion per year which compares with £400-800 million on the Norwegian Continental Shelf and a forecast of between £650 million-800 million on the Dutch Continental Shelf

• Forty-six per cent - £7.9 billion - of the total UKCS decommissioning spend from 2017 to 2025 will be concentrated in the central North Sea.

• The largest category of expenditure on the UKCS between 2017-2025 is well plugging and abandonment at 49 per cent - £8.3 billion.

Mr Tholen said: “With industry driving efficiency improvements which have led to a 16 per cent 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 five per cent in the central and northern North Sea and west of Shetland, and by four per cent in the southern North Sea and Irish Sea with further cost reductions predicted as the sector ensures decommissioning is carried out as cost- effectively as possible, while maintaining high safety and environmental standards.”

Lessons learnt from decommissioning projects since 2012 are gathered in Oil & Gas UK’s Steel Piled Jacket in the North Sea Region report which updates industry intelligence for decommissioning this type of offshore platform.

The report captures the experience gained from 63 projects that have decommissioned to date. Advances in health and safety, environment and technology, including cutting and lifting solutions, are among areas highlighted.

Mr Tholen added:

“These reports demonstrate the UK’s growing expertise in decommissioning and these capabilities have been developing alongside the industry’s focus on more productive activities in oil and gas production. They highlight that there is a very real opportunity for the UK’s decommissioning sector to develop competitive capabilities and become a champion of decommissioning excellence in the global arena. “

Last issue

View the last issue here.

View the past issue archive here.