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Offshore decommissioning ‘a new beginning for North Sea industry’

Offshore decommissioning ‘a new beginning for North Sea industry’

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Brent Delta is among the most iconic platforms

By Ken Banks: BBC Scotland North East reporter

As a growing number of North Sea oil and gas fields head towards the end of their production lives, industry leaders are waking up to the challenges – and opportunities – that lie ahead. Hundreds of business figures attended a conference in Aberdeen this week to learn more about where the decommissioning process is heading.

There’s a growing realisation that offshore decommissioning is now really happening.

Over the next 25 years or so, the process of retiring North Sea oil and gas facilities could cost tens of billions of pounds, according to projections.

But while that is a cost for the operators of the more than 600 oil and gas installations in the North Sea it is an opportunity for firms which can develop the safest and most cost-effective ways forward.

It could also mean hundreds of new jobs requiring a new kind of expertise in the coming decades.

A major industry event – Decom Offshore 2015 – has been running at the Aberdeen Exhibition and Conference Centre.

The event is run by Decom North Sea (DNS), which was created in 2009, the representative body for the offshore decommissioning industry.

DNS chairman Callum Falconer said: “We are cutting our teeth. There’s a sudden realisation that decommissioning is upon us.

“Decommissioning used to be seen as the beginning of the end. Now it’s seen as the beginning.”

“One challenge is that we have to make sure the workforce comes together.

“There’s an opportunity for young graduates and engineers to carve out a career in decommissioning.”

‘Interconnected industry’

Mr Falconer highlighted work that is under way on a new decommissioning learning portal for the industry, to share ideas, which he predicted would be a “game changer”.

One of the major decommissioning plans already in the pipeline is for the iconic Brent field, off Shetland, which operated by Royal Dutch Shell.

The oil field lends its name to the benchmark for setting oil prices in the North Sea – Brent Crude.

Shell has four platforms in the field but only one of them, Brent Charlie, still produces oil.

DNS chief executive Nigel Jenkins outlined five key areas of decommissioning focus – driving collaboration, efficiency, getting the supply chain ready, innovation, and delivering benefits.

Mr Jenkins said: “Collaboration is key due to the interconnected nature of the industry, and the need to share knowledge.

“Decommissioning on this scale has not happened before.

“Particularly for this region, for Aberdeen, we need to make this area is a centre of excellence, a place where the right sort of expertise is available.”

He explained there had been about 10 major decommissioning projects in the UK Continental Shelf (UKCS) over the past 20 years, and there was now set to be a “ramp up” in such activity.

He said it was difficult to predict potential job numbers, but highlighted that Shell’s Brent decommissioning project has hundreds of people working on it.

Mr Jenkins said: “There are so many influences over when a project will happen, including age, oil left in a field, and the price of oil.

“That equation is different for every operator.”

‘Seismic change’

He said: “This conference has shown what a great pool of talent there is to address the challenges. There is a positive feeling.

“We’re at the beginning of the market. We are at a point of seismic change.”

Shell’s current work is not the first decommissioning project from the Brent field.

Twenty years ago, the Brent Spar got international coverage over Shell plans to dump the oil storage module in the deep waters of the North Atlantic.

Protesters from Greenpeace occupied it for several days in 1995 and Shell was forced to alter its plans.

Brent Spar was instead towed to Norway and moored in a fjord, before being broken up.

Although the first stage of this fresh wave of plans – using a giant ship to remove the top of platforms in a single lift – is unlikely to prompt controversy on that scale, there is little doubt the second phase will be the subject of closer scrutiny.

This involves contaminated concrete oil storage tanks, which sit on the seabed next to the platform’s legs.

This challenging new chapter in the North Sea story is well and truly under way.

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