Decommissioning Insight 2019

3.4 Expenditure Breakdown

Figure 5 shows the forecast expenditure expected in different areas of decommissioning projects over the next ten years.

Figure 5: UKCS Expenditure breakdown 2019, to 2028

Topsides and Substructure Onshore Disposal • Onshorewaste handling • Deconstruction • Decontamination

Subsea Infrastructure • Pipeline decommissioning • Mattress decommissioning • Subsea Structure decommissioning

Site Remediation andMonitoring • Debris clearance • Monitoring requirements

3

Removals • Removal activities for the topsides • Removal activities for the substructure s

2%

9%

Well Decommissioning • Engineering Spread rate and services associated with phase 1, phase 2 and phase 3 well decommissioning Operator Costs • Projectmanagement services throughout preperation of decommissioning programme • (Post CoPOPEX) Operational expenditure after occurrence of Cessation of Production Facilities and Pipelines Permanent i solation and cl eaning , and Topsides Preparation • Engineering down and clean for topsides and pipelines • Preparation of platform for unattendedmode

2%

18%

7%

45%

17%

Source: OGUK, OGA

The 2019 dataset shows a similar breakdown of expenditure to that of previous Decommissioning Insight reports, however there are some subtle differences: 1. Well decommissioning (45 per cent): £6.8 billion is forecast to be spent on well decommissioning over the next decade, a reduction from the £7.5 billion reported in 2018. 1,630 wells are expected to be decommissioned, compared with 1,465 last year. This demonstrates that the market is becoming more efficient in well decommissioning, conducting more work for less. 2. Operator costs (17 per cent): This is a combination of decommissioning project management and the cost of operating platforms after production is ceased. £2.5 billion is anticipated to be spent on these elements over the next ten years, in line with last year’s data. 3. Removals (18 per cent): This is the combined costs of removing topsides and jacket structures on the UKCS. £2.7 billion is expected to be spent on removals over the next decade — a notable increase on the £2 billion forecast in last year’s report. 4. Subsea infrastructure (9 per cent): £1.3 billion is expected to be spent on subsea infrastructure decommissioning over the next decade, and includes activities related to pipelines, mattresses and subsea structures. This is a reduction from the £1.7 billion reported in last year’s dataset.

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