Decommissioning Insight 2018

DECOMMISSIONING INSIGHT 2018

Data collected in 2018 suggest that the profile of expenditure within each WBS element remains consistent with previous Decommissioning Insight reports. The four largest areas of spend are:

1. Well decommissioning (49 per cent): £7.5 billion is forecast to be spent over the next decade, a reduction from the £9.2 billion forecast made from data gathered in 2017.

2. Operator costs (17 per cent): A combination of decommissioning project management and the cost of operating a platform after production is ceased. This amounts to £2.5 billion over the next ten years, or a slight reduction from the £2.9 billion last year.

3. Removals (13 per cent): This is the combined costs of topsides and substructure removals and amounts to £2 billion over the next ten years. This is a notable reduction from the £2.9 billion in last year’s findings.

4. Subsea infrastructure (12 per cent): This includes activities related to pipelines, mattresses and subsea structures, and amounts to £1.7 billion of expenditure over the next decade. This is a reduction from £2.3 billion last year. Understanding the key cost drivers helps focus attention on delivering efficiencies in decommissioning. With progress geared towards achieving the 35 per cent reduction target by 2035 it is important to highlight these drivers and set key performance indicators (KPIs) to measure progress. The Decommissioning Task Force — a group formed as a result of the MER UK initiative — is currently developing these KPIs for decommissioning in partnership with industry and the regulators, which will aid in assessing whether these targets are being met.

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