The number of fields and facilities approaching the end of their producing lifetime is increasing, with more than 100 platforms in the UK Continental Shelf (UKCS) forecast for either partial or full decommissioning in the coming decade.
As the numbers indicate, it’s a hot topic. So, before we continue, allow me to set the scene with what I feel are some of the biggest challenges involved.
Challenge one. Decommissioning is an unavoidable cost. The Oil & Gas Authority (OGA) recently produced a new cost estimate for offshore oil and gas decommissioning in the UKCS, valuing it at £59.7 billion. The regulator has set an industry target to reduce costs by 35%—to less than £39 billion—still a significant outlay.
Challenge two. Decommissioning is inevitable. While prolonging operations and extending the economic life of an asset is always going to be the preferred option, decommissioning is simply a natural part of the oil and gas lifecycle.
Challenge three. The industry is required to plug and abandon (P&A) wells at the lowest cost, with the lowest risk, best surety and in the most safe and sustainable way. Trouble is, there is no single methodology and strategy varies from one company to the next.
So, how do we address the situation? Well, without going into too much detail, the dedicated Decommissioning Zone at Offshore Europe this week is a good example of the kind of focused effort that is needed.
Not just because we need a collaborative, industry-wide approach, but because we need to be open to trying out new things.
I hope this TechTalk will help shed some light on the efforts we are making at Baker Hughes, a GE Company (BHGE), as well as provide some perspective from the OGA and Decom North Sea, both critical participants in this arena.