According to latest figures from Oil & Gas UK, decommissioning is the only business area where expenditure increased last year on the UKCS, from just over US$1.2 billion (£1 billion) in 2015 to $1.5 billion (£1.2 billion) in 2016.
Expenditure is expected to rise further in 2017 to around $2.5 billion (£2 billion) as activity around major projects increases, with an average annual expenditure over the next decade of $2.2 billion (£1.8 billion).
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Decommissioning scopes being carried out on Brent Delta. Images from Shell. |
The industry is understandably focused on how to make the process more technically and economically efficient.
Shell recently completed the single lift removal of its 24,200-tonne Brent Delta topside, which had stood in the North Sea since 1976. The Pioneering Spirit vessel set a world lifting record when it raised the topside off its three concrete legs and transported it to the English east coast to be recycled. Planning for a similar operation is now underway for the topside of the Brent Bravo.
Shell is hosting a keynote panel session on decommissioning at SPE Offshore Europe 2017. Panelists include senior spokespeople from CNR, Chevron, Hereema Marine Contractors, Marine Scotland and the BEIS. Steve Phimister, executive committee memberof the event and vice president of Shell's UK and Ireland upstream business unit will chair the panel.
He said the discussion aims to address many of the most pertinent questions: “It will be built around a number of different themes important to efficient decommissioning in the UKCS, from skills, capabilities and new technologies, to societal acceptance, late life asset management and plugging and making safe the wells.
“It will be interesting to learn from our expert panel and delegates if the industry believes we’re thinking big enough on the issue of decommissioning."
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Decommissioning preparation is underway |
According to Oil & Gas UK, annual expenditure is expected to reach around $2.5 billion (£2 billion) on the UKCS in 2017 making up around 12% of total expenditure. However, deciphering and deciding future decommissioning costs for UK and Norwegian projects is challenging.
“The most important area of focus for the industry is ensuring all decommissioning activity is executed in a safe, responsible and cost-effective manner,” asserted Phimister. “The holy grail of efficient campaigns is isolating a well on a single trip, months before a platforms removal. End of field life planning is also critical. Operators should not to be afraid to use new technology and reach out to innovative supply chain companies.”
Fourteen fields ceased production in 2016 with at least a similar amount expected this year.
“We can’t continue to treat decommissioning and removal as a reversal of the processes and practices when we drilled the wells and installed the facilities.
“We do not view decommissioning and restoration (D&R) as an area for competition, but encourage learning from each other’s practices,” Phimister stated. “It is encouraging to see that oil and gas companies are already sharing lessons, working closely with the regulator and stakeholders to maximize wider understanding of the issues and the challenges faced in end of field life management in this low price environment.
A new event feature for 2017 is the Decommissioning Zone, which will include a themed exhibition hall for decommissioning technology and service providers and a conference program being organized in association with Decom North Sea, IMechE, ITF and SUT.
“Offshore Europe will be a great platform to showcase new, innovative technologies and a fantastic meeting place for industry leaders, government and suppliers to develop and cultivate new and existing relationships.”
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