Decommissioning Insight 2015

Historical Variation in Cost Forecasts The average and range of cost forecasts for platform well P&A in the SNS and Irish Sea have remained relatively stable over the last five surveys. For suspended subsea E&A and subsea development wells, average forecast costs have increased consistently over the last four years, as some operators revise their forecasts upwards based on experience gained in well P&A. A number of wells with lower costs that were previously included in the survey are deferred and move out of the timeframe, increasing the average for both types of subsea well. In the SNS and Irish Sea, recent reductions in rig rates driven by the current low oil price have not yet been detected in these expenditure forecasts. As in the CNS and NNS/WofS regions, the average and range of expenditure forecasts for platform well P&A are lower than for the subsea wells. Figure 10: Historical Variation in Well Plugging and Abandonment Cost Forecasts in the Southern North Sea and Irish Sea

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2

3

4

10 15 20 25 30 35 40 45 50

5

Average Forecast Cost Platform Well Average Forecast Cost Suspended Subsea E&A Well Average Forecast Cost Subsea Development Well Range in Cost Forecasts

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8

0 5

Estimated Cost per Well (£ Million - 2015 Money)

*

*

2011 2012 2013 2014 2015

2011 2012 2013 2014 2015

2011 2012 2013 2014 2015

9

Platform

Subsea E&A

Subsea Development

*Data cannot be split out for subsea E&A and development wells for 2011

Source: Oil & Gas UK

Well P&A

2014 Average £2.7million £5million £7.6million

2015 Average £3million £8.8million £9.6million

Platform wells

Subsea E&A wells

Subsea development wells

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