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Report shows rise in UK’s decommissioning competitiveness

The UK decommissioning sector’s growing competitiveness was revealed in the 2019 Decommissioning Insight report launched by Oil and Gas UK (OGUK) in late November 2019. The report forecasts the UK’s decommissioning activity and expenditure over the next decade, noting that while activity on the UK Continental Shelf (UKCS) is expected to increase, expenditure will remain consistent at around £1.5bn/y, demonstrating the sector’s improving efficiency performance.

The report findings show:

  • Decommissioning now represents just under 10% of the oil and gas industry’s overall expenditure.
  • The pace of decommissioning expenditure remains steady at around £1.5bn/y.
  • Over the next decade, forecast expenditure for UKCS decommissioning remains constant at £15.2bn.
  • Merger and acquisition (M&A) activity in some areas of the North Sea is extending the life of offshore assets and moving decommissioning activity to the future.
  • Within the next decade, $85bn (£67bn) will be spent decommissioning oil and gas assets in the global market.
  • To date, 9% of all the platforms installed on the UKCS have been decommissioned.


Commenting on the report, OGUK’s Decommissioning Manager Joe Leask says: ‘With a firm grip on cost management, environmental and safety standards, our tenth annual
Decommissioning Insight shows a healthy sector well-positioned to realise some £15bn of opportunities over the next decade. Our report underlines the significant intellectual capital anchored here in the UK. Ensuring this is shared is key to maintaining the competitiveness of the sector, enabling this homegrown industry to capture the lion’s share of an emerging global market some four times greater.’

He continues: ‘We’re already seeing exciting new companies emerging as specialists in decommissioning, either offering full-scope solutions or focusing on specialising in areas including offshore well decommissioning and onshore dismantling and disposal. These innovative business models offer industry real choices whether operators carry out decommissioning themselves or pass the scope to those companies offering increasingly competitive solutions.’

‘Decommissioning is not the end of our industry; it offers a new beginning. Four years ago, industry stepped up to the challenge to cut decommissioning costs by 35% and we are well on the way to achieving that. We must apply the same collective determination and pioneering capabilities to deliver the net zero carbon challenge. This includes the re-use of old facilities for carbon capture and storage, presenting new opportunities to generate new value from old assets and help deliver the net zero future that industry has made commitment to deliver.’

News Item details


Journal title: Petroleum Review

Countries: UK -

Subjects: Decommissioning, Exploration and production, Forecasting

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