Decommissioning is the process of withdrawing offshore energy infrastructure from use once it’s no longer needed or at the end of its lifecycle.
The growing demand for such services will generate billions of pounds worth of work for UK companies, especially for energy communities based near the central and northern North Sea.
Such opportunities also bring challenges – including spikes in demand for supply chain services, alongside competition for resources and skills generated by the expansion of renewables.
Emerging energies – such as offshore wind – must work with and learn from the oil and gas decommissioning sector so they can put in place the most efficient decommissioning programmes ahead of construction.
The decommissioning opportunity is growing, as well as demand for supply chain services and, with the right action from the industry, billions of pounds worth of work could be secured for industrial communities across the country.
As a sector, we know we must collaborate across energies to make sure we can capture the lion’s share of work in the UK and make the most of this decommissioning surge.
The trend we are seeing is that the decommissioning sector has executed more projects and spent more money than ever before.
OEUK’s upcoming Decommissioning Insight report will examine the wider North Sea so that there is basin-wide visibility for the decommissioning market.
Offshore wind data will also be interpreted so that cross-sector knowledge and assets might be shared for the best possible results.
Delivering this work will be difficult, given the plethora of macro-economic factors at play – a key part of this is a lack of investor confidence following the Energy Profits Levy and how the UK votes in next year’s election.
The fact that the UK’s decommissioning sector is delivering so much in such challenging environments shows resilience and excellence which should be applauded.
Dramatic growth needs careful management. Lessons learnt within the sector are crucial and may have application to other sectors as the competition for resources and equipment intensifies.
The UK supply chain will work more efficiently if it can accurately forecast demand for its services not just in petroleum, but in low-carbon energy too.
Relentless drives for innovation and new technology from the sector have continued to drive costs down.
However, while new technology and collaboration must be wholeheartedly embraced, the cost savings they bring might do little more than offset inflation.
We also know that assessing the savings that new technology brings will be complicated by the instability of the fiscal regime in the next few years.
Resilience and innovation are vital if the UK is to become the global centre of excellence for decommissioning.
While the rate is reaching a peak, the right support from the government is needed to retain this in the UK.
The sector needs fiscal and political stability to ensure that the decommissioning prize is captured, with its thousands of jobs and contracts for billions of pounds worth of highly skilled work potentially at stake.
Decommissioning is an intrinsic part of the energy transition: we must harness the decommissioning workforce and skillset in the right way for the future as this will not only support the UK economy, but support people and communities across the country as we move towards a net zero future.
Just imagine how much knowledge can be gained by decommissioning and repurposing the wonders of the past: this is a once-in-a-generation opportunity to shape our energy future.