FAQ – How to kick-start your North Sea decommissioning project in the current climate
Acteon believes that alternative approaches and challenging convention is the answer to achieving efficiency savings. The traditional approach involves hiring an offshore contractor who often relies on its own fleet and supply chain to bring creativity and equipment. Acteon’s fresh approach involves execution specialists who generate and deliver the back-deck solution; we select the optimum vessel (size and cost) to deliver the solution, resulting in an overall bespoke solution that is safe, fit for purpose and commercially attractive.
Rigless methods for plugging and abandoning wells have revolutionised North Sea decommissioning operations in the last 20 years. Utilisation of existing assets, for example jack-up lift barges (JULBs) and vessel support, can open up rigless options where Acteon can help clients gain the flexibility, tooling and resources to abandon wells by using multi-platform deployable equipment.
Another approach that Acteon uses to drive down costs is to promote campaigns that deliver similar scopes of work across fields or for multiple operators. This cost reduction method has been proven to be highly effective for well abandonment operations and is equally applicable for other subsea infrastructure removal operations.
ARE THERE RULES AND REGULATIONS FOR DEVELOPING A DECOMMISSIONING PROGRAMME?
The UK Government is responsible for ensuring North Sea infrastructure is dismantled safely and the OGA is helping oil companies reduce decommissioning costs.
The decommissioning of offshore oil and gas installations and pipelines on the UKCS is controlled through the stringent regulatory process that is stipulated in the UK’s Petroleum Act 1998. The responsibility for ensuring that the requirements of the Petroleum Act 1998 are compiled rests with the Offshore Petroleum Regulator for Environment and Decommissioning (OPRED) which sits within the Department for Business, Energy and Industrial Strategy (BEIS). Guidelines for decommissioning of offshore installations and pipelines are available from the BEIS. Operators must submit Decommissioning Programmes to BEIS for review, which is then followed by public consultation, as part of the extensive approval process. In other regions, the guidelines will also be defined by the local government regulations.
WHAT HAPPENS TO ABANDONED MATERIALS?
RMT regional organiser, Jake Molloy, who also chairs the Offshore Coordinating Group said the OGA should use its licensing powers to compel operators to take their platforms to UK ports for dismantling which, combined with the effect of P&A campaigns, could potentially mean more jobs being saved in the current crisis.
Under current rules – which include the Petroleum Act 1998 and the OSPAR convention governing the North Sea, oil and gas operators are mostly required to remove all or part of installations when they are no longer in use. North Sea legislation states that the rig’s support structure must be completely removed if it weighs less than 10,000 tonnes. However, for platforms which are heavier and were built before 1999, before removal was considered part of rig designs, operators can attempt to put together what is called a ‘derogation’ case allowing them to leave much of it in place.
The materials which are not left in place, usually the topsides of the rigs, are taken ashore and dismantled. Materials such as metal are recycled where possible. However, a lot of the metal is unsuitable for recycling and therefore is simply broken down and taken to a landfill along with the concrete and other elements of the rig. In a few cases, creative uses for abandoned platforms have been found, including a museum and overnight accommodation for divers.
Acteon helps clients retrieve production assets, and flexible and semi-rigid products using tailored approaches to cost-effectively restore a subsea marine environment. The service includes the disposal of umbilicals offshore; retrieval of production assets such as subsea trees, wellheads and manifolds; removal of flexible and semi-rigid products including offshore umbilicals, risers, gas lift flowlines and mooring systems. We use diverless techniques where possible and have the flexibility and expertise to handle unusual and complex projects.
HOW LONG DOES A DECOMMISSIONING PROJECT TAKE?
Due to the amount of planning required and multiple processes involved, decommissioning projects often take more than a decade before projects even commence. However, if the Scottish Government decides to accelerate campaigns, the approval process may be considerably shortened in a bid to get workers out in the field as soon as possible.
Once offshore, time savings can be achieved by taking an integrated approach to projects. The integration of decommissioning services and Acteon’s willingness to propose new business models and offer pricing structures can amplify these savings. Any cost reduction helps operators to undertake timely decommissioning, which reduces the risk that well integrity problems will accumulate.
WHAT ARE THE ENVIRONMENTAL IMPACTS?
Not only are there cost implications with decommissioning projects, but there is also the environment to consider. From the perspective of causing minimum disturbance to sea life, leaving subsea structures in place and utilising rigs to reef is often a favoured option – as Claxton, an Acteon company, covered in a previous blog. Artificial reefs are known to be one of the most effective means of increasing the bio-productivity of coastal waters by providing secure habitats for marine life which become more established as the years go by. They are widely and effectively used on the shelves of many countries.
Some operators have argued that removing platforms without a trace will cause more environmental damage than leaving parts behind. On the decommissioning of the Brent field, Shell has sought an exemption from OSPAR to leave the legs jutting out of the water as navigational tools for fishermen. Shell made a ‘derogation’ case, claiming that the platforms were built quickly and without considering decommissioning, therefore it would be safer to leave them in situ.
The broader environmental effects of decommissioning should also be considered. The effort of removing heavy topsides, for example, requires lifting equipment, tugs and barges which create a vast amount of CO2 to transport the rig to shore. These types of environmental impacts continue to be a much-debated subject.
All of Acteon’s decommissioning solutions are focused on sustainably minimising the cost of securing legacy hydrocarbons from the marine environment to restore a clean post-industrial setting.
ARE THERE BENEFITS FOR OPERATORS TO BUILD STRATEGIC PARTNERSHIPS WITH THE SUPPLY CHAIN?
Before the COVID-19 crisis, the downturn in the oil and gas industry presented huge challenges but decommissioning provided a massive economic opportunity. Operators are now looking much more seriously at decommissioning plans and recognise the complexities of the process require them to build partnerships with a supply chain who have the knowledge and experience to support their strategy.
Acteon can support the delivery of integrated services by providing project and activity management services and can second personnel or recruit contractors, as required. Because Acteon is independent of traditional contractors and equipment manufacturers, the field life service team can build strategic partnerships on a project-by-project basis as necessary to deliver the best value. This helps to secure the most suitable vessel for delivering each integrated service, anywhere in the world. Independence enables the team to focus on delivering cost-effective decommissioning solutions to clients rather than maximising vessel utilisation.
There is clearly a pressing need to stimulate activity in the UKCS to safeguard the large number of supply chain jobs which have been lost, are under threat, or are currently furloughed.
It is promising to see that industry groups are pursuing a number of initiatives, including a coordinated approach to decommissioning programmes, which have the potential to help safeguard jobs, and lead to greater cost efficiency and are working with government and industry to progress these.
With an expected influx of activity, Acteon can deliver innovative, low-cost approaches to plugging and abandoning suspended subsea and platform wells and removing all types of subsea infrastructure. By combining proven products and services and delivering them as integrated services through a single point of contact, we can reduce overheads and make timely decommissioning more attractive.
All offshore oil and gas installations must eventually be decommissioned. Increasingly, the pressure is on the operators or licensees of redundant fields and suspended wells to act sooner rather than later. Download this e-book for fresh thinking and technical innovation to reduce field abandonment costs.