Decommissioning Insight 2017

DECOMMISSIONING INSIGHT 2017

5.4 Regional Breakdown Forty-six per cent (£7.9 billion) of UKCS decommissioning expenditure from 2017 to 2025 is concentrated in the central North Sea, 35 per cent (£6 billion) in the northern North Sea and west of Shetland, and 19 per cent (£3.2 billion) in the southern North Sea and Irish Sea. The higher proportion of expenditure in the central and northern North Sea regions reflects the size and degree of complexity of projects in these regions where sea conditions are more challenging due to deeper water. While the number of platforms to be removed is greater in the southern North Sea and Irish Sea, these are typically much smaller installations that are simpler and therefore cheaper to decommission.

Figure 13: Regional Breakdown of Decommissioning Expenditure

Southern North Sea and Irish Sea 19%

Central North Sea 46%

Northern North Sea and West of Shetland 35%

Source: Oil & Gas UK, Asset Stewardship Survey

5.5 Expenditure by Decommissioning Component

Costs are estimated according to the different components of decommissioning as defined in the Work Breakdown Structure (see Figure 14 opposite).

The largest category of expenditure from 2017 to 2025 is well P&A at 49 per cent (£8.3 billion), compared to 47 per cent in the Decommissioning Insight 2016 . This is due to an increase in the number of wells and does not reflect higher forecast unit costs, which have fallen for all well types and regions in the UKCS as outlined in section 5.7.

The removal of topsides and substructures accounts for 15 per cent (£2.6 billion) or 21 per cent (£3.5 billion) when the associated preparatory work for removal is also considered.

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