UK's well abandonment market worth £15 billion

The well abandonment market on the UK Continental Shelf (UKCS) is worth a potential £15 billion, according to new research published by industry trade body Oil & Gas UK.

Uchenna Izundu
OGJ International Editor

LONDON, Mar. 12 -- The well abandonment market on the UK Continental Shelf (UKCS) is worth a potential £15 billion, according to new research published by industry trade body Oil & Gas UK.

The report stressed that new technologies, such as well control, must be developed to tackle a third of rigless abandonments.

Over the next 15 years, an estimated 3,725 platform wells and 910 subsea wells on the UKCS will be abandoned. Existing technology can remove two thirds of those wells without a rig, which is typically more cost effective. Paul Dymond, OGUK's operations director, called on suppliers to invest in the provision of innovative services and new technology. "The industry needs to look very closely at how to position itself to grasp those opportunities."

OGUK commissioned InterAct Activity Management Ltd. (InterAct), a project management and engineering consultancy, to carry out the report in partnership with its well abandonment workgroup.

First published in 2005, OGUK has also updated its guidelines on suspending operations for a limited period when finally abandoning a well.

Schoenmakers said, "The latest insights enabling efficient and sound well abandonments have been incorporated into the guidelines. They now clarify the requirement to squeeze perforations and advise on well construction in facilitating well abandonment. The guidance also reflects the key changes of single plug risk assessment and, with additional diagrams, is now easier to use."

Fields that are being decommissioned are Miller on Blocks 16/7b and 16/8b, Brent, and Indefatigable.

Miller produced some 345 million bbl of oil during its lifetime, and production ended in 2007. BP PLC is preparing a plan for its decommissioning, which will be submitted to the government in the first half of 2007. Decommissioning costs are expected to exceed £200 million.

Brent is in 140 m of water and consists of four large platforms; Alpha, Bravo, Charlie, and Delta. It is still producing gas, but operator Royal Dutch Shell PLC is carrying out stakeholder dialogues to determine decommissioning options. It has not announced a date to end production. Shell is planning the abandonment of the existing oil and gas wells, and decommissioning.

Shell's Indefatigable gas field, which is 75 km offshore in the southern North Sea, stopped production in July 2005. The Shell/Esso side of the field produced around 1.79 tscf of natural gas and 3.6 million bbl of condensate during its lifetime.

In January Shell contracted AF Gruppen to decommission six platforms from Indefatigable. The work will cost £20 million and is expected to take 3 years. Around 13,000 tonnes of steel and equipment from the field's structures will be recycled.

Preparatory work is underway for the offshore platform decommissioning activity. AF Decom Offshore, part of AF Gruppen's environmental business, will carry out the offshore lift preparations and onshore dismantling activities for the project.

Contact Uchenna Izundu at uchennai@pennwell.com.

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