Decommissioning Offshore Structures

This chapter reviews the environmental management aspects of the decommissioning of offshore structures, with particular reference to the United Kingdom Continental Shelf. After some brief background material and a discussion of the principles involved, the topic is described in terms of three separate levels. Level one is defined by the minimum requirements, as set out in the legal framework and government guidelines and requirements. The second level is represented by a set of guidelines, agreed by the operating companies and published by the association that represents them, the United Kingdom Offshore Operators Association (UKOOA). These go somewhat beyond the legal minimum, and provide a management system and an environmental checklist for all offshore operations, of which decommissioning is just one. Finally, an examination of the specific case of Brent Spar will illustrate how Shell fulfilled all requirements to the letter, went some way beyond even UKOOA’s guidelines, and still encountered major difficulties. The management issue at this point goes beyond the quantitative ticking off of tasks and conditions, and into the softer qualitative areas of politics and sociology, social responsibility and ethics.

The options for decommissioning offshore facilities and structures are many and various. They are driven by environmental protection, cost, health and safety, available technology and politics. This chapter examines the range and type of facilities and structures which will be decommissioned; the framework of legal requirements; the onshore sites at which the work can be done; the possibilities of reuse and materiel recovery; the methods available and possibly requiring development for cutting, toppling, lifting and transportation, and the particular problems associated with the larger fixed structures.

Over the next 20 years a large proportion of the 200 or so fixed offshore oil and gas installations in the UK sector of the continental shelf will need to decommissioned, together with some of the 20 or so floating production systems. The same is true of installations in the Norwegian, Danish and other sectors.

The subject of field decommissioning has many dimensions. In this chapter the economic and fiscal aspects relating to the situation in the UKCS are examined. The specific issues analysed are (1) economic criteria for optimising the timing of decommissioning of individual fields including mothballing aspects, (2) the likely timing and aggregate expenditures on decommissioning activities in the UKCS, (3) the operation of the system of tax reliefs for the expenditures involved, and (4) decommissioning aspects of the re-use of facilities.

This chapter is intended to provide readers, especially those who are not lawyers, with an outline of some aspects of the legal regimes applicable to the decommissioning of offshore oil installations. While it covers a fairly wide area, some specialised aspects of decommissioning, such as taxation, are beyond the writer’s competence and have been omitted for that reason.

Discussion of the political significance of the decommissioning of offshore structures means encountering a number of fundamental concerns of social science. One of these is the relationship between two central terms: the public interest and private interest. Another is the relevance of the consultation model of political decision-making. Yet another concerns the reasons for policy change. The Brent Spar events during April of 1995 — up to the date of the Greenpeace occupation — exhibit the search for consent among the affected interests that underpins much, particularly technically based, governmental decision making. However, ultimately, this case indicates that the search for agreement is not necessarily fruitful if there are fundamentally different objectives, values and priorities among those with an interest. Moreover the success of the consultation may have been undermined by the lack of breadth in its range.