Oil and Gas Authority looking to cut cost of UK Continental Shelf decommissioning to $39 billion
The Oil and Gas Authority (OGA) has said it wants to cut the cost of decommissioning the UK Continental Shelf to no more than £39 billion.
In a report, the body said the objective must be shared by the industry and government, with costs thought to split evenly between the two.
The OGA estimates an overall decommissioning cost £59.7 billion in 2016 prices, but if a minimum 35% cost reduction can be applied, the total could come down to less than £39 billion.
“The OGA’s approach has been to develop a probabilistic cost estimate, which takes into account the broad range of uncertainties and uses data submitted by oil and gas operators as part of its 2016 UKCS Stewardship Survey,” said the OGA.
In the future OGA plans to:
• Publish an annual progress update report
• Apply benchmarking, using actual decommissioning costs to assess operators’ estimates
• Work with operators and the wider industry to share lessons learned, develop innovative approaches to contracting strategy, and enhance the capability of the supply chain
• Promote innovative collaboration such as the multi-operator well plugging and abandonment campaign.
“This report provides us with a starting point cost estimate of £59.7 billion to decommission UK oil and gas infrastructure. The challenge now is to save industry and the tax payer money and achieve safe decommissioning for £39 billion or less,” said Gunther Newcombe, the OGA’s Operations Director.
“To achieve this target there will be a need for significant change in the way decommissioning is approached and behavioral change will be a critical component.
“The OGA will continue to work closely with operators and the supply chain to ensure key information and lessons are shared and new approaches to contracting are developed. There is a clear and sizeable opportunity for the supply chain to develop an efficient, low cost, and exportable industry capability.”
Global Offshore rebrands Enelift and invests in global hubs
Global Offshore has rebranded Enelift and will invest "a seven-figure sum" in establishing new support hubs in Houston, Dubai, Singapore, Perth and the Caspian during the next six months.
The investment will cover oil, gas and renewables, mainly concentrating on manufacturing capability with associated R&D, as well as in stock held in the hubs.
The company’s flagship Hinge Lok technology provides aluminium, non-welded light weight transportation cradle for casing and tubing. Enelift now plans to enhance its offering by augmenting its existing solutions with robotics and remote operational and training technology, which will reduce manpower for handling offshore equipment that is transported and stored using the Hinge Lok system.
Enelift is partnering with "a Japanese robotics company" and the technology will be trialed with "a Norwegian operator on a Norwegian drilling rig", according to a statement.
Operating from its bases in Aberdeen, UK and Esbjerg, Enelift was founded by 35-year industry veteran and Managing Director Paul Brebner 10 years ago to offer the offshore energy industries safe, reliable and efficient storage and transportation of equipment.
The expansion plans are bolstered by the appointment of Jim Clark of the Craigendarroch Group to Chairman, and Adam Maitland to Non-Executive Director. Maitland is the Managing Director of Hutcheon Mearns IF, and brings his wealth of expertise in the field of corporate finance.
Brebner said Enelift may be a new name in the market, but the experience it brings is "industry renowned".
"Our solutions are underpinned by safety that enables inefficiencies and their associated costs to be eradicated – meaning operational personnel can focus doing what they do best, safely. We remain committed to providing the safest storage and transportation solutions for equipment in the sector as we grow our global operations," he said.
Clark said the market is changing and its solutions fully support customers’ economic and safety aspirations.
"We are very well placed to take full advantage of increasing opportunities in the Middle East, Africa, Far East and Americas. Safety is our absolute commitment to our customers and our support hubs will facilitate this. Aligning our identity to our entire offering ensures that we will drive our expansion through new products and global support sites across the rest of this year."