Evening Telegraph (First Edition)
£17bn to be spent on scrapping rigs
MORE than £17 billion will be spent on decommissioning North Sea oil platforms over the next decade, according to a report.
Between the UK and Norwegian continental shelves more than 100 platforms will be completely or partially removed, with around 1,800 wells scheduled to be plugged and 7,500km of pipeline forecast to be decommissioned, Oil & Gas UK said.
Dundee is seeking to secure a significant share of decommissioning contract work, with hopes that at least 1,500 new jobs could come to the city.
Earlier this year, Forth Ports announced plans to extend Prince Charles Wharf to enhance Dundee’s capabilities as an oil-support facility
Decommissioning Insight 2016, published by Oil & Gas UK, said the market was worth more than £2bn last year.
The total amount forecast to be spent on decommissioning on the UK Continental Shelf (UKCS) between now and 2025 is £17.6bn, up from £16.9bn for the 2015-24 forecast.
The Scottish Government believes there are “very real economic benefits” to come from decommissioning.
Mike Tholen, Oil & Gas UK’s upstream policy director, said: “The UK’s supply chain will need to focus on developing a highquality, cost-efficient and competitive decommissioning capacity to make the most of the opportunity and provide a range of goods and services that can not only be deployed in the UK but also exported overseas.”
Despite the expected growth, the report warns against “premature decommissioning”, with up to 20 billion barrels of oil and gas still said to be recoverable from the North Sea.
Mr Tholen added: “If the UK is to continue to gain the full economic benefit from its oil and gas resource, it is important that the industry continues to work with the Oil and Gas Authority, as well as with HM Treasury to attract fresh investment, avoid premature decommissioning, retain the critical infrastructure needed to access future reserves and ensure decommissioning is carried out in a timely and most cost-effective way.”
Scotland’s energy minister Paul Wheelhouse said: “We agree with Oil and Gas UK that there are very real economic benefits for Scotland to come from decommissioning and we are well placed to capitalise on them — indeed, we believe Scottish suppliers are already well established in areas of decommissioning, such as high-value well plugging and abandonment activity.”