By Jesper Toft Madsen, October 2016
High costs and low oil prices are compelling offshore operators to prolong the lives of existing platforms. When old rigs finally retire, however, they must be removed, reused or disposed of to prevent contamination and potential safety risks to shipping.
The decommissioning process is a complicated and expensive affair. Removal was the traditional method for dealing with North Sea rigs, but a new approach is catching on. Marine biologists have pointed out that, over decades of rig operation, marine life has flourished around the deep-sea substructures. In fact, oil rigs off the California coast can house some of the richest maritime ecosystems in the world.
“They’re more productive than coral reefs, more productive than estuaries. It just turns out by chance that platforms have a lot of animals that are growing really quickly,” says Milton Love, Professor of Marine Biology at the University of California, Santa Barbara.
Keep it simple
Tim Martin, Managing Director of Ramboll Oil & Gas in the UK, welcomes the marine biologists’ endorsement.
“Leaving some structures behind is a more pragmatic solution that can save operators and society a lot of money, while also preserving the vulnerable natural environments in which organisms have grown dependent on the structures. But we need to overcome current policies to enhance them,” says Tim Martin.
UK-based operators can claim tax relief for decom projects, so taxpayers foot half the bill. The economic and environmental benefits of the partial clean-up could thus prove a best-case scenario for the industry, taxpayers – and fish.
However, there is still a long way to go. The decom process can last three to ten years from start to finish. Besides the regulatory barriers and environmental requirements that must be taken into account, formulating a cost-effective, safe and sustainable decom strategy on what precisely to decommission and how is extraordinarily demanding.
“To keep costs at a minimum, we aim to simplify technical solutions. In the UK, the onshore tradition is to engineer the complex golden solution, as it results in a better and more reliable product. Offshore decom is about saving costs, since there is no end product besides worthless metal, and the more the decom costs, the worse the product gets,” explains Tim Martin.
At one of the first North Sea oil fields to close because of falling oil prices, Ramboll experts have conducted an independent review of the decom strategy, helping to redefine contracting methodology and challenging the prevailing technical approaches. In an attempt to create savings for the operator and taxpayers, Ramboll has suggested a solution that makes intervention vessels superfluous by reutilising existing equipment, thus eliminating toxic and radioactive materials and cutting costs by 8-10%.
More industry collaboration
Offshore operators tend to work out their decom processes individually, which poses its own set of challenges. Joining forces with other operators to obtain permits, conduct environmental analyses and bear removal costs can create economies of scale, explains Nathan Swankie, Principal at Ramboll Environment & Health.
“Operators often claim that competing interests make it difficult for them to work together. We help them navigate between their interests and facilitate dialogue. Everyone wants a strong business case, and they will get it by collaborating,” says Nathan Swankie.
He adds that if oil companies fail to procure the relevant permits – often several years before the actual removal starts – already tight schedules risk being delayed.
Professor David Lusseau from the University of Aberdeen, School of Biological Sciences, backs the need for more industry collaboration, environmental optimisation and cost-efficiency. He is currently working with lawyers, economists, ecologists and engineers to understand all the consequences of completely removing platforms from the North Sea.
“Some argue that we should remove everything and return the North Sea to its original condition. But what is the pristine condition and how do we return it to that state? Ecosystems are complex adaptive systems, and it’s difficult to predict the outcomes of state shifts. So the remove-all approach is set to fail, I think, and may actually work against its original intention. Instead, we should aim for decom to maximise the health of the current ecosystem and its resilience. We need to develop a comprehensive decision-making process that considers what benefits the removal of each component might bring and what impact they might cause,” says professor Lusseau.
Some structures end their days giving new life to marine flora and fauna in the rigs-to-reefs programme, through which decommissioned oil and petroleum rigs are converted into artificial reefs. In the USA, where the practice started and is most common, rigs-to-reefs is a nationwide programme, and in 2012 about 10% of all decommissioned platforms had been converted into permanent reefs.
A study published by the Proceedings of the National Academy of Science (PNAS) in 2014 showed that fish production on the average platform is almost 30 times greater than on natural reefs due in part to the unique vertical structure of an oil platform.
Facts: the scale
There are over 600 oil and gas installations in the North Sea, many of which have been producing oil and gas for almost 40 years. In the decades to come, a growing number of oil and gas installations will be decommissioned.
Source: Decom North Sea