This is an increase of £2.3 billion on the 2014 report’s ten-year forecast of £14.6 billion -primarily due to 47 new projects entering this year’s survey by UK Oil and Gas.
Over the next decade, 79 North Sea platforms are forecast to be cut and shut -representing around 17% of some 470 installations that will require decommissioning over the next 30 to 40 years. However, Technological advances and improved production cost efficiency could defer the timing of decommissioning for these projects.
The survey also confirms there are a small number of major decommissioning projects under way with well plugging and abandonment activities representing the largest category of expenditure with over 1,200 wells scheduled for work over the next decade.
Oonagh Werngren, Operations Director, Oil & Gas UK, commented: “While the industry recognises decommissioning activities are steadily growing, its focus is to maintain offshore production in the North Sea for as long as it’s safe and economically possible to do.
“The key to sustaining the health of the sector is to take the initiative now to help an efficient decommissioning market emerge as part of, and alongside the industry’s continued and sustained programme of capital investment in new developments.