US$32 billion of decommissioning worldwide over the next five years: is the industry ready?
Many consider decommissioning a North Sea problem, but it is quickly becoming one of the biggest issues in the global oil and gas industry today. For obvious reasons, mature regions such as the North Sea, Asia Pacific and US Gulf of Mexico (deep water) are at the forefront. But the pioneers will set the tone for what is essentially an emergent industry in itself. As it stands, US$32 billion of decommissioning spend is expected in the next five years. This is a result of over 700 fields ceasing production over this period. There's also been an uptick in decommissioning due to the availability of cheaper rigs. This all brings a hefty bill for oil companies. The top 10 companies are expected to spend US$14 billion from 2018 to 2022. There is naturally a huge opportunity for the supply chain, but the challenge remains of defining the offering and timing of the investment.