Decommissioning Insight 2019

DECOMMISSIONING INSIGHT 2019

3.3 Expenditure and Activity Overview The UK expects to spend £15.2 billion on decommissioning activity over the next decade. This is consistent with the £15.3 billion as reported in the 2018 Decommissioning Insight report. Figure 3 shows the annual expenditure forecast for each Work Breakdown Structure (WBS) element, with the blue line below the chart indicating the number of fields with decommissioning activity each year. For a second consecutive year average expenditure is expected to run at around £1.5 billion per year, providing further evidence of a maturing market. However, this year’s data show a wider fluctuation, with expenditure falling to below £1 billion in five years then rising above £2.1 billion towards the end of the decade. It should also be noted that this ten-year snapshot is only a portion of the OGA’s total cost estimate which anticipates a spend of £51 billion for all UK decommissioning liabilities. 9

Figure 3: UKCS Decommissioning Expenditure 2019, to 2028

2,500

2018 Actuals

Post-decommissioning Monitoring

Site Remedia�on

Subsea Infrastructure

Topsides & Substructure Onshore Recycling Substructure Removal

Topsides Removal

Topsides Prepara�on

Facili�es / Pipeline De-energising

2,000

Well Decommissioning

Post-CoP Facility Running / Owner Costs

Operator Project Management

1,500

1,000

500

Annual Expenditure (£ Million – 2018 Money)

0

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

Source: OGUK, OGA

67

62

60

59

56

55

54

44

44

41

Number of fields

36

with decommisioning ac�vity

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

Source: OGUK, OGA

Actual expenditure on decommissioning in 2018 was £1.3 billion, slightly less than the £1.68 billion forecast in Decommissioning Insight 2018 . While it appears that a limited amount of work has been re-phased, industry is also conducting activities more efficiently, further contributing to lower actual expenditure. Previous reports

Source: OGUK, OGA

9 www.ogauthority.co.uk/news-publications/publications/2019/ukcs-decommissioning-cost-estimate-2019-report/

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