Offshore Energy UK (OEUK) reported that despite an increase in spending on offshore decommissioning, the actual work carried out decreased last year. In 2023, £1.7 billion was spent on decommissioning in the UK continental shelf, a slight increase from the previous year. However, only 126 wells were decommissioned in 2023, down from 139 in 2022.
According to Ricky Thomson, the author of the report, there is a need for a significant change in the coming years as over 2,050 wells are expected to be decommissioned in the next decade, which accounts for more than 80% of the active well stock. One of the challenges faced in this process is the competition for resources, as many of the ships and facilities used in oil and gas decommissioning are also required for offshore wind installation. This clash between industries calls for innovation to attract more heavy-lift ships to UK waters.
The industry also faced challenges such as cost inflation, political uncertainty, and competition for resources, making it harder for businesses to invest in decommissioning. Mark Wilson, the operations director at OEUK, expressed concerns about the decrease in work despite the increase in spending. He highlighted the challenges posed by the influx of renewable projects and the uncertain political and fiscal landscape.
Overall, the industry spent more money on decommissioning in 2023 while carrying out less work. This discrepancy is attributed to various macroeconomic factors that have made it challenging for businesses to operate in this space. Despite these challenges, there is a need for proactive measures to address the growing demand for decommissioning activities in the coming years.
