Decommissioning is one of the fastest-growing activities in the oil and gas sector. Many offshore assets are coming to the end of their design lives, on average 25-30 years, or are being sacrificed to a prolonged industry downturn caused by low oil prices . Dismantling and disposing of these structures in a cost-effective and environmentally-friendly manner is a pressing concern for both companies and governments.
In some lights, decommissioning emphasises the current malaise in the oil and gas sector. This is the first time that the UK offshore industry is abandoning more wells than it drills, with production having dropped by two-thirds in the past 16 years . However, decommissioning also offers lucrative commercial opportunities and spurs the development of innovative new technologies. There are many challenges involved in the process, from safely dismantling and transporting large structures in changeable weather and waters, to disposing of them at destination with minimal environmental impact.
The UK public had a recent front-row view of some of the potential complications of relocating oil and gas infrastructure in August 2016, when a 17,000-tonne rig ran aground on the Isle of Lewis during a storm while being towed to Malta . It spent more than two months at the Scottish island before continuing on its journey.
Tugboats towing away the Transocean oil rig ‘Winner’, run aground on the Scottish island of Lewis .
The North Sea has become one of the new global hotspots for oil and gas decommissioning. It does not have a well-developed industry yet, unlike more mature basins such as the Gulf of Mexico, but it is in great need of one as it is shutting down operations with unprecedented speed. By the mid-2050’s, approximately 470 platforms and 5,000 wells but also 10,000 kilometres of pipe and 40,000 concrete blocks will need to have been sealed or moved from its waters. This will cost at least £30-60 billion . The GMB union, which objects to the decommissioning tax relief extended to UK oil and gas companies, places the estimate at closer to £100 billion .
Despite the sobering implications for the sector at large, decommissioning offers opportunities for UK oil and gas companies looking to develop innovative strategies. There are different options for retiring platforms, both topside and substructure, including part or all of the rig being towed long distances to be recycled at destination. There are numerous alternatives for plugging and abandoning wells, and the optimal materials for plugging them will need to be identified – such as cement, resin, silicon or rubber.
The variety of options available should spur improvements to a wide range of technologies, software and processes. For example, improving Remote Operated Vehicle (ROV) functionality for monitoring might entail improving lighting equipment and developing reliable miniature cameras for high-resolution live feeds as well as Printed Circuit Board (PCB) technologies with efficient heat dissipation.
Decommissioning will require improved means of handling, treating, recycling and disposing of hazardous materials as well, including lead paint, asbestos, and Naturally Occurring Radioactive Material (NORM). These processes could take place onsite or offsite after safe encapsulation and transportation of the waste.
In addition to visible infrastructure, miles of pipes and concrete will also be decommissioned .
In addition to offshore platforms, with which the public is most familiar, there are vast amounts of underwater structures which will also require handling, recycling or disposal. Current regulations require the removal of ‘mattresses’, concrete structures protecting pipelines and other subsea assets . In the North and Irish Seas, these include between 35,000 and 40,000 units – up to 200,000 tonnes of concrete. Since these structures were not designed to be recovered, it can be difficult and costly to remove them.
Few mattress decommissioning projects have been carried out in the North Sea so far, so companies will need to develop strategies for recovering different sizes and styles of these concrete structures while minimising the risk to personnel and the environment. These strategies could include increasing the use of ROVs rather than divers, developing new equipment for removal and disposal, and finding alternatives for recycling and reuse.
It remains to be seen how soon the oil and gas sector as a whole will bounce back from the current downturn, but it can at least offer new opportunities for innovation and commercial gain in decommissioning existing infrastructures. The Scottish government has also established a range of tax relief and funding opportunities for oil and gas companies, to try to sustain an industry which has been vital to the national economy.
Alejandro ALCALA, MSc, Senior Consultant in R&D Tax Relief & Grants, Leyton UK
Alexi BAKER, PhD, Grants Specialist and Social Media Coordinator, Leyton UK
 On 30 November, oil prices began to rise after an OPEC agreement to cut output for the first time in eight years, but whether or not this contributes to a long-term recovery will depend on the compliance of individual countries. http://www.bbc.com/news/business-38169383
 DECOM NORTH SEA. (2015) Mattresses Solutions [Online] Available from: http://decomnorthsea.com/uploads/pdfs/projects/DNS-Mattress-Solutions_JEE-Report_June-2015.pdf