Other News

US Bureau to call for decommissioning costs from owners

The Bureau of Safety and Environmental Enforcement (BSEE) in the US said owners of operation rights will be required to submit their expenditures for decommissioning of wells, platforms and other facilities. The move will affect sites on the Outer Continental Shelf (OCS) as part of the final decommissioning costs rule.

North Sea

North Sea decommissioning expenditure to hit £17bn over next decade

The UK oil and gas industry’s decommissioning sector is growing at a steady pace, with total expenditure expected to hit £16.9billion over the next decade, a new study shows. Oil and Gas UK (OGUK) raised the forecast from £14.6billion a year ago, citing an influx of 47 new projects into its 2015 Decommissioning Insight survey. A total of 79 platforms are now expected to be removed across the UK continental shelf by 2024, according to the poll, which was launched at the Offshore Decommissioning Conference in St Andrews.

Oil & Gas

Oil price decline may lead to “decommissioning glut”

The oil price crash is expected to usher in a “decommissioning glut” in the North Sea, new research has revealed. Delegates at Offshore Europe this week heard that there has been little evidence so far of early decommissioning of North Sea fields rendered uneconomic by the falling price of a barrel of oil. But research firm Wood Mackenzie has estimated that there will be 50 fields facing early shutdown and dismantling due to low oil prices over the next five years. This is above and beyond the estimated 139 fields what have been scheduled for dismantling as they reach the end of their natural lives.

North Sea

Xodus nets Nexen decom contract

Aberdeen-based Xodus Group has been awarded a contract with Nexen to provide Front End Engineering and Design (FEED) services in support of the decommissioning of the Ettrick and Blackbird fields in the central North Sea.

Oil & Gas

Operators urged to sell ageing assets but retain liabilities in North Sea

Operators have been urged to sell ageing oil and gas assets but retain decommissioning liabilities worth billions in order to avoid the threat of early shut downs in the North Sea. Analysts at KPMG have warned that oil and gas operators as well as the new Oil and Gas Autority (OGA) need to approach decommissioning in a new way or risk failing to “maximise economic recovery” as recommended by industry veteran, Sir Ian Wood. In the report, KPMG said many North Sea firms lacked the capability to undertake decommissioning or were “poorly suited” to managing late life assets. This would only be worsened by the possibility of a “ large wave” of decomissioning projects going ahead by 2020, driving up costs and increasing the burden on skills.

Other News

Gallery: Work underway with Centrica decommissioning projects

This image shows the Paragon B391 drilling rig leaving Rotterdam as it made its way to Centrica’s decommissioning projects in the southern North Sea gas basin. The photo, which was captured by a drone, shows the rig as it travelled to the site where it will carry out well plugging and abandonment activities on two single-well subsea fields. Paragon will work on the Stamford gas and Rose decommissioning project.

Oil & Gas

Gulf Marine decommissiong deal is with ConocoPhillips

ConocoPhillips has confirmed it is behind a new contract to support decommissioning activity in the UK North Sea. It was keeping quiet about its involvement on Monday, when Abu Dhabi-based Gulf Marine Services (GMS) said one of its large class advanced self-propelled self-elevating support vessels (SESVs) was moving from well service and maintenance work to help with decommissioning activity this summer. Yesterday, a spokeswoman for Houston-based ConocoPhillips the GMS Endurance, gave more details. She said: “The GMS Endurance is currently on contract to ConocoPhillips UK, carrying out maintenance work in the southern North Sea (SNS). “It will move across to provide support for ongoing decommissioning work at the Viking location later this summer. “ConocoPhillips is currently pursuing a planned and phased decommissioning programme for the southern North Sea. “Our initial focus is on the Viking area, where well plug and abandonment work started last year.” She added: “ConocoPhillips has a number of gas fields in the SNS that are approaching the end of their natural lives.


Opinion: Realising the recovery value of ageing assets

An ageing asset doesn’t mean unmanageable, unprofitable and inoperable. There is still potential to be realised from the UK Continental Shelf (UKCS), despite the challenges of the current climate. In terms of oil alone, it is estimated that there are around 25billion barrels to be recovered. Global demand for energy continues to escalate and fossil fuels will carry on contributing to the mix. The UK Government is also committed to supporting the sector, as we have seen from the prior administration’s positive response to Sir Ian Wood’s 2014 state of the industry report.