48 / 74
DECOMMISSIONING INSIGHT REPORT
2016
48
None of the UKCS projects included in the survey are reported as Class 1. These would have project definition
levels of 50 to 100 per cent with many of the activities already in execution. Projects that were classified as Class
1 in the 2015 report have now been completed and no new projects have moved into this category. Only two
projects were reported as Class 2, where project definition is between 30 and 70 per cent and is either at the
contracting stage or being executed.
Figure 33 shows the percentage of annual expenditure for projects on the UKCS split by AACE classification.
Sixty-nine per cent of expenditure in 2016 comes from the large number of Class 4 or 5 projects, each contributing
a small amount of expenditure, typically for operator project management or well P&A. Companies often start
well P&A while they develop and define the scopes of the other decommissioning activities.
Figure 33: AACE Cost Class Breakdown
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Percentage of Annual Expenditure
Class 5
Class 4
Class 3
Class 2
Class 1
Source: Oil & Gas UK