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ECONOMIC REPORT 2015
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0
0.5
1
1.5
2
2.5
2014
2015
2016
2017
2018
Decommissioning Expenditure (£ Billion)
Source: Oil & Gas UK
Figure 48: Decommissioning Forecast by Field
7.8 Decommissioning
The industry is determined to avoid premature
decommissioning and retain the infrastructure required
to achieve MER UK. However, there will always come a
time when the costs of further recovery can no longer
be sustained by income from the field and when the
surrounding region is considered to have insufficient
prospectivity to support future operations.
The UKCS’ maturity means that decommissioning is
one of the OGA’s priorities. It is aligned with industry
strategy to ensure decommissioning is carried out
as cost effectively and safely as possible, but not
prematurely.
While decommissioning on the UKCS is still in its infancy,
expenditure in this area passed £1 billion for the first
time in 2014. It is likely to rise to around £1.5 billion in
2015 and to over £2 billion per annum by 2018. Last
year, 14 fields on the UKCS incurred spend in excess of
£10 million on decommissioning activity. That number
is likely to rise to over 50 fields at different phases of
decommissioning by the end of the decade.
The scale of some of the decommissioning projects to be
undertaken on the UKCS over the next decade has not
been seen before anywhere in the world. Where the UK
leads, other countries will inevitably follow and demand
for expertise will continue to grow both domestically
and globally. The experience gained over the next
decade will offer a competitive advantage to the UK’s
domestic supply chain, providing the opportunity to
become world leaders in this field as long as companies
are able to adapt their businesses to offer support on
decommissioning projects. See Section 8 for a case
study on the Brent decommissioning project.