Decommissioning and Abandonment
A recent report titled “UK Continental Shelf (UKCS) Maximizing Recovery Review” by Sir Ian Wood provides an interesting view into late-life-production and decommissioning issues in a mature basin. It is a good treatment of the issues specific to the UK sector of the North Sea, and I believe that many of these issues (and possible solutions) can apply more broadly to our global maturing offshore infrastructure.
Here are a few highlights from the late-life/decommissioning recommendations from the Wood Report.
- Asset Stewardship Strategy—Ensure focus on stewardship of assets and infrastructure to maximize the economic recovery from fields and with consideration to adjacent resources.
- Regional Development Strategy—Ensure the development of resources on a regional, rather than solely a field, basis.
- Infrastructure Strategy—Ensure that the life of the existing infrastructure is prolonged to facilitate the production and transport of regional resources.
- Technology Strategy—Ensure that existing technologies are deployed to their fullest and that relevant new technologies are developed and deployed successfully.
- Decommissioning Strategy—Ensure that key assets are not decommissioned prematurely to the detriment of production hubs and infrastructure, and ensure that decommissioning is executed in a safe, environmentally sound, and cost-effective manner with sufficient early planning and coordination.
It can be seen that actualization of the recommendations from the Wood Report could drive the operator toward a life-of-field or even a life-of-region planning perspective. As the operator approaches the end of a field’s life, the remaining value may lie predominantly in a low-cost decommissioning delivery coupled with some upside value from the retention of critical infrastructure to enable maximum regional resource recovery. Actualizing this value will require the operator to begin late-life and decommissioning planning much earlier than cessation of production. The operator will need a process to assess the field’s timing and value drivers, communicate them externally to other stakeholders (operator, supply chain, and regulator), and periodically update and adjust them as time and conditions change. The challenge is that, at present, there does not exist a mechanism to facilitate this level of collaboration. We should keep an eye on the developments in the UKCS in the wake of the Wood Report. The efforts there may provide a solution template that can be considered globally.
SPE 163942 Plug and Abandonment of a Deep High-Pressure and High-Temperature Gulf of Mexico Well Using Coiled Tubing: A Case History by Brendon Webb, Schlumberger, et al.
SPE 168517 An Optimized Protocol To Expedite Pit Closure by Rob Hoffmann, Chevron, et al.
SPE 170949 Environmental Risk and Well Integrity of Plugged and Abandoned Wells by George E. King, Apache, et al.
Decommissioning and Abandonment
Win Thornton, SPE, Vice President of Decommissioning, BP
01 January 2015
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