Offshore oil, gas decommissioning to grow steadily in UK and Norway

Offshore oil and gas decommissioning in the UK and Norway is expected to rise “gradually but steadily” in the next 10 years. That’s the forecast made by Oil and Gas UK […]

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By Jacqueline Echevarria

Offshore oil and gas decommissioning in the UK and Norway is expected to rise “gradually but steadily” in the next 10 years.

That’s the forecast made by Oil and Gas UK in its latest report.

It states 100 platforms are expected to be completely or partially removed from the UK and Norwegian Continental Shelves during the same period.

More than 1,800 wells are also scheduled to be abandoned and around 7,500 kilometres of pipeline are expected to be decommissioned.

The industry body also said total decommissioning expenditure in both countries last year was £2.1 billion, compared with just under £1.6 billion in 2014.

The total amount forecast to be spent on decommissioning on the UK Continental Shelf (UKCS) between now and 2025 is £17.6 billion, up from £16.9 billion in 2015.

The report notes that while 52 new projects appeared for the first time in this report, most had been “a long time in the planning”.

Mike Tholen, Oil and Gas UK’s Upstream Policy Director said: “With low oil prices continuing, you might expect decommissioning to be a key focus for the sector in the years ahead, however we are not witnessing a rush to decommission.

“Different factors are at play and the picture is much more complex. Some companies are deferring cessation of production as field life has been extended by sustained efficiency improvements; others are delaying activity due to cash-flow constraints; while elsewhere, companies may be expediting decommissioning to take advantage of falling costs in the current downturn.”

He adds the UK’s supply chain will need to focus on developing high-quality, cost-efficient and competitive decommissioning capacity “to make the most of the opportunity and provide a range of goods and services that can not only be deployed in the UK but also exported overseas”.