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Cost of closing UK oil and gas rigs rises “billions”

It could cost billions more to properly close down oil and gas rigs around the UK coast than previously estimated.

Latest estimates from trade body Oil & Gas UK peg the price of decommissioning rigs between 2014 and 2023 at £14.6 billion.

That’s far more than it totted up last year and the oil group said £3 billion of the rise because new respondents took their survey, while it put an extra £1.2 billion down to higher forecasts from existing projects.

Whereas last year £470 million was spent on decommissioning, operators forecast this spending will reach £1 billion for the first time in a single year. They reckon it will average £1.5 billion each year over the next decade.

Operations Director Oonagh Werngren said operators may wish to team up on programmes “to reduce cost and gain greater efficiency”.

The broader supply chain should take note to ensure the UK Continental Shelf is “geared up to take on this new challenge, ensuring the right technologies are developed”, she added.

The Decommissioning Insight 2014 report, it was drawn from operators’ responses to an Oil & Gas UK survey about decommissioning over the summer.

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