Oil & Gas UK’s 2018 Decommissioning Insight Report, which provides a fresh insight of the market over the next ten years (2018–27), reveals that decommissioning expenditure is expected to run at about £1.5 billion per annum over the next decade, 20 per cent lower than forecast in 2017.
The report shows:
Unveiling the report findings to industry experts at the conference in St Andrews today, Joe Leask, Decommissioning Manager Oil & Gas UK and author of the report, said:
“As the decommissioning sector matures, we’re becoming more efficient and our growing expertise is enabling us to plan projects more cost-effectively. Our knowledge is continuously expanding and contributing to competitive decommissioning delivery. Data from projects to date reveals the scale of progress achieved in recent years. Forecast unit well decommissioning costs are reducing across all areas of the North Sea, and have fallen by an average of 26%.
“The efficiency improvements we see in decommissioning reflect what is being achieved across the oil and gas lifecycle and attracting fresh investment in the basin, to extend the life of many assets and increase economic recovery.
“The sector’s cost leadership demonstrates we have the capacity and capability to deliver the 35 percent cost reduction target set by the Oil and Gas Authority. Meeting and then beating this target will be key to unlocking the global market, allowing the UK to reinforce its position as world-leading.
“Oil & Gas UK is pleased that these capabilities are recognised by the UK government through its call for evidence in the 2018 Budget. This will, supported by the Scottish Government’s Decommissioning Challenge Fund, help establish the UK as centre for global decommissioning excellence.”
“Our focus now needs to be on identifying the areas we excel in, strengthening the share of our local market and then exporting those skills and capabilities into the global market.”
The report also notes:
Over the next decade
Notes to Editors:
Issued by the Communications Team, Oil & Gas UK. Contact Natalie Coupar, Communications Manager on 01224 577343 or 07531 407007/ ncoupar @oilandgasuk.co.uk
Oil & Gas UK is the leading representative organisation for the UK offshore oil and gas industry. Its membership comprises oil and gas producers and contractor companies.