Decommissioning, as we have seen in the case of recent North Sea projects, is set to be increasingly technically challenging, and with that, costly. From initial planning to the site clean-up, a decommissioning project can also take a significant period — potentially years to complete.
Therefore, it’s essential, particularly with a cost-saving target of 35% set by the UK Oil and Gas Authority (OGA), that operators fine-tune their projects to lower potential complications throughout the processes they implement.
With that in mind, here are our top tips to maximise your assets and save time and money when planning your next decommissioning project.
1. Planning and legislation
When planning, you should remember that the rig environment, including platform type, will influence a combination of factors within your potential decommissioning strategy. You should also pay close attention to factors such as the age and condition of the existing equipment, the depth of the water, the size and weight of the rig, and finally, the laws within the region.
Project management and planning for the decommissioning of an offshore rig typically starts three years before the well runs dry. However, with an increased focus on cost-savings and efficiency, it’s essential to construct your plans as far as 10 years in advance. For example, before Shell started their Brent Field Decommissioning Programme, they required 10 years of review and planning, extensive research, the input of independent experts, and scientific assessments to ensure appropriate plans were in place to start the project successfully.
The OGA’s decommissioning roadmap is a useful tool to assist the decommissioning planning process, allowing project managers to map out the steps alongside real-life examples. These include initial assessments and propositions, to execution and waste management. Paying close attention to minimising the environmental impact of your project will of course also be key. The Decom North Sea’s environmental appraisal guidelines provides insights into environmental requirements for UK Continental Shelf (UKCS) oil and gas decommissioning projects.
Of course, before taking strategies further, it is a legal requirement to understand and ensure you are adhering to legislation. These include the 1998 Petroleum Act, the 2008 Energy Act, and 1996 Pipeline Safety Regulations. To guide operators with legislation adherence, Oil and Gas UK has developed environmental legislation resources to support you in your planning process before UKCS decommissioning project. It is worth keeping in mind, however, that there are no one-size-fits-all laws and regulations, and they will change depending on the region your project is based in.
2. Collaborating with other operators
In early 2017, the OGA asked operators to participate in a pilot multi-operator decommissioning programme. Multi-operator decommissioning contracts are agreements in which two or more operators use decommissioning services over a period of time, with the aim to demonstrate the cost-savings created by collaborative working. Multi-operator decommissioning will enable operators to reach an efficient means of decommissioning assets and provide a wealth of accessible knowledge and best practices when tackling.
The full pilot programme, launching in 2018/19, will stimulate collaborative working to save on costs throughout the UKCS.
Although the opportunity to participate in this particular collaborative pilot programme has passed, cooperation is still vital for the decommissioning sector to progress. Sir Ian Wood’s UKCS Maximising Recovery Review stresses that to maximise recovery in the North Sea, collaboration not only between operators, but with the supply chain, government, and the regulator, is pivotal to future decommissioning successes.
3. Contingency planning
Well-structured contingency planning is essential to account for a decommissioning project's potential difficulties. Contingency costs can be estimated based on predictions of their probability of occurrence, and analysis of similar costs on past projects. Potential contingency costs can be based on:
Engineering and project management
These potential costs can vary based on a variety of factors, including labour force size and project duration — many of which are not well known until the engineering details of the project are determined. A 2011 review of nearly 50 oil and gas companies by Turner & Townsend found that lower project management costs are incurred on projects with which operators have the most experience, and that costs increase for more complex projects. Other factors that contributed to higher project management costs included poorly developed regional infrastructure, and fast-tracking the project schedule.
It can be difficult to forecast how the weather will influence a planned decommissioning schedule. However, a weather allowance percentage is included in decommissioning cost estimates. The Bureau of Safety and Environmental Enforcement (BSEE) claims that the contingency allowance for weather is typically 20%, consisting of 14% for regular weather delays and 6% for delays from tropical storms.
Work contingencies include extra costs accumulated through delays or deviations from the project. For example, if the condition of a well that requires plugging and abandoning is unknown, a work contingency could compensate for potential delays. In the report by the BSEE mentioned above, a typical work contingency allowance will stand at 15%.
4. Safety management
It goes without saying that a decommissioning project should be executed with optimum care for both engineers and the environment.
In a survey carried out by Decom North Sea, operators have previously expressed the importance of demonstrating ‘practical experience’ of a decommissioning project, to be aware of how to manage potential health and safety risks. Running procedures such as risk-based inspections (RBIs) regularly throughout decommissioning projects can also assist with planning for any potential difficulties that can threaten a project’s success, including health and safety concerns.
As well as potential RBIs and practical experience, standards such as the NORSOK have enabled offshore service companies like Claxton to provide a safer, more efficient service offering for our projects. The health and safety approaches of NORSOK standards have not only prevented a potential tragedy, but have also reduced project costs and required equipment.
5. Equipment suited to your project
Factoring in the harsh environments and deep waters in areas such as the North Sea, and making use of the right equipment, is vital to your decommissioning project. Claxton's decommissioning package includes field-tested tools, that have been used on over 280 cutting and recovery projects, over 85 wells cuts, and over 130 suspended well abandonment projects.
The WellRaizer® well recovery system has been used without the need of a jack-up rig or platform-based drilling derrick on a variety of projects. It allows for the efficient deployment of the SABRE™ Subsea Abrasive Cutting system to sever well casings using a jet of garnet, water, and air. Deploying our Queen’s Award for Innovation winner SWAT™ (Suspended Well Abandonment Tool) also provides the right platform on the wellhead to carry out casing perforation and placement.
Decommissioning tools are essential to completing decommissioning projects efficiently and safely.
A one-stop decommissioning solution
With operators facing a boom of decommissioning projects over the next decade, Claxton's team thrives amongst these challenges.
Our experience of decommissioning is vast, with all our solutions offered in-house. We also provide bespoke and flexible decommissioning services to fit our clients’ needs. Claxton’s team know the importance of getting every step right in the lengthy decommissioning process, and our one-stop shop for decommissioning can guide you through all the key elements of a project plan, to execute your project effectively.
Download our free decommissioning case study pack today, and learn how we’ve made even the trickiest of decommissioning projects a success.