A new decommissioning action plan launched today by the Scottish government’s economic development agencies hopes to help Scotland’s oil and gas sector take advantage of the estimated £17.6 billion forecast by Oil & Gas UK to be spent on decommissioning on the UK Continental Shelf (UKCS) between now and 2025.
On the UKCS alone, 302 oil and gas installations, 373 subsea installations, 16,000km of pipelines and more than 5000 wells will all eventually need to be decommissioned.
With a strong track record developing around decommissioning projects, it is estimated the gross value add (GVA) direct and indirect impacts for Scotland could reach £11 billion by 2025, which would support a peak of around 23,000 jobs as a result.
The overall aim of the plan, developed by Scottish Enterprise and Highlands and Islands Enterprise, is to establish Scotland as an international Centre of Excellence for decommissioning and to assist the development and delivery of effective solutions for decommissioning.
Building on Scotland’s globally recognized oil and gas expertise, the plan is focused around six strategic objectives - information, supply chain, technology and innovation, infrastructure, skills and training and international opportunities. These will be delivered through a number of actions such as: development of a Decommissioning Support Program to provide expert advice to 50 companies engagement with 150 companies to raise awareness of and stimulate demand for innovation and R&D support for decommissioning engagement with ports and onshore yards to encourage future investment opportunities identifying overseas decommissioning opportunities and facilitate trade missions to/from Scotland to explore inward investment/partnership opportunities.
The development of new technologies and an increased focus on skills and training is also highlighted to help grow Scotland’s reputation and position it at the forefront of this global opportunity.
The plan will be led, in the main, by Scottish Enterprise and Highlands and Islands Enterprise with close collaboration with others including Skills Development Scotland, the Oil and Gas Authority, the Department of Business Energy and Industrial Strategy (BEIS) and industry bodies such as Decom North Sea and Oil & Gas UK.
Minister for Business, Innovation and Energy, Paul Wheelhouse said: “This action plan clarifies the range of different activities involved in decommissioning programs, from high value offshore activity such as well plugging and abandonment, to the relatively lower value contracts for onshore disposal of topsides and substructures.
“Scottish companies are already securing very significant value from a range of offshore decommissioning activities, with the majority of work being commissioned from UK contractors, and Scottish-based firms already securing the lion’s share of work secured from UK suppliers. This plan will build upon that success to maximize the economic opportunity arising from this key part of the lifecycle for fields on the UKCS.”
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