ACTIVITY SURVEY 2014
page 36
9.
Decommissioning
Decommissioning is now becoming a significant part of UKCS expenditure, accounting for 3.5 per cent (£0.9 billion)
of the total spend in 2013. Decommissioning expenditure is expected to average £1.3 billion per year over the
remainder of the decade, peaking at £1.7 billion in 2016.
Figure 27: Forecast for Decommissioning Expenditure
When looking out to 2040, it is anticipated that decommissioning expenditure will total about £40.6 billion, of
which £37 billion will be to decommission existing installations and those that have already been approved and
a further £3.6 billion to decommission new fields yet to be installed. Overall predicted decommissioning costs
to 2040 have remained fairly static compared with last year’s survey, suggesting that decommissioning has been
postponed on a number of facilities. The reassurances provided by the Decommissioning Relief Deeds (DRDs),
contracts between government and industry guaranteeing tax relief on decommissioning costs, are likely to be a
contributory factor.
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2013
2014
2015
2016
2017
2018
Decommissioning Spend (£ Billion)
Total Decommissioning >P50
2012 Forecast
Source: Oil & Gas UK
