Cessation and decommissioning

Currently, just under half of the expected recoverable resources on the Norwegian continental shelf have been produced. At the same time, parts of the shelf are maturing. Shutdown of production and removal of facilities (disposal) is expected on a number of fields over the next few years.
Currently, just under half of the expected recoverable resources on the Norwegian continental shelf have been produced. At the same time, parts of the shelf are maturing. Shutdown of production and removal of facilities (disposal) is expected on a number of fields over the next few years.
Regulations Major facilities Small facilities Landing Costs

Through all phases of field development, including decommissioning, consideration shall be given to health, safety and the environment (HSE) and to other users of the sea. The disposal process begins once a facility is no longer being used. The facility must be removed and the area cleared. The licensees are required to provide a comprehensive description of all phases of this process in a decommissioning plan. The plan must be submitted to the Ministry of Petroleum and Energy within two to five years before a licence expires or is relinquished, or when a facility will no longer be used.

Key principles for processing a decommissioning plan are that all financially profitable and recoverable oil and gas resources must have been produced, that the decommissioning project is cost-effective and that the project can be carried out within an acceptable framework with regard to HSE and other users of the sea.

Authorities have processed and approved a total of about 20 decommissioning plans, five of them in 2016. Over the next decade, it is expected that between 20 and 30 currently producing fields will shut down production and dispose the facilities. However, it is difficult to estimate exactly when producing fields will shut down. The figure below shows how the presumed final production year for a selection of fields has changed between the reporting in 1995, 2002 and 2016.

The field lifetimes are extended

Change in estimated lifetime for selected fields

Source: Norwegian Petroleum Directorate

Print illustration Download data The field lifetimes are extended Download PDF Download as image (PNG)

The field lifetimes are extended – Change in estimated lifetime for selected fields

Usually, facilities stay on fields longer than planned for in the development stage. On many fields, new tie-ins (satellite fields) and improved recovery initiatives have extended field lifetimes beyond what was estimated in the Plan for Development and Operation (PDO). In addition, facilities on fields with tie-ins that shut down their own production can be used as a host facility for processing and transport for other nearby fields. Therefore, the facilities on a field that shuts down its own production are not necessarily removed immediately.

What does a decommissioning plan consist of?

The decommissioning plan consists of two main parts, a disposal part and an impact assessment part. The disposal part describes the technical and financial aspects of the cessation project. The impact assessment part provides an overview of expected consequences of the disposal, e.g. for the environment and other users of the sea. Both the proposed impact assessment programme and the actual impact assessment report must be submitted for public consultation.

Current regulations

Cessation of the petroleum activities and disposal of facilities are regulated by the Petroleum Act and Petroleum Regulations. Norway acts also in accordance with international regulations and agreements, such as the Oslo-Paris Convention (OSPAR), which stipulates that petroleum facilities can be abandoned after shutdown only in highly extraordinary scenarios.

Section 5-3 of the Petroleum Act stipulates that the Ministry of Petroleum and Energy (MPE) makes disposal decisions. Article 60 of the United Nations Convention on the Law of the Sea (UNCLOS) stipulates that facilities shall, as a general rule, be removed, and that both removal and potential abandonment shall take place in accordance with internationally accepted standards. In accordance with this and the OSPAR Convention, the authorities can make decisions on removal of subsea installations, floating steel installations and the topsides of concrete installations without submitting the case to the Storting (Norwegian parliament).

Facilities must be removed in their entirety; only in extremely limited cases they can be abandoned on the field after ended use

However, for disposal of concrete facilities and the jacket on large, fixed steel facilities, the case is still presented to the Storting before the MPE makes a disposal decision (such as Frigg TCP2 and Ekofisk T). There are currently 12 other concrete facilities on the Shelf that will be discussed in the Storting with regard to removal or abandonment pursuant to the OSPAR Convention.

Pipelines are covered under the scope of the Petroleum Act, but not the OSPAR Convention. The choice of disposal options is determined in each individual case based on a broad assessment of costs evaluated in relation to the consequences for safety, environment, fisheries and other users of the sea.

Disposal of disused pipelines and cables on the Norwegian shelf are discussed in a separate Storting Report. Removal of the pipelines is not considered expedient based on HSE and costs. The Storting Report therefore concludes that pipelines and cables can generally be abandoned after they have been emptied and cleaned. Following a specific assessment, consideration for other users of the sea may identify a need to bury/cover disposed pipelines and cables. Pipeline disposal decisions are also made by the authorities.

Disposal of major facilities

Field developments are very different with regard to size, complexity and number of facilities. Major fields can have development and operation in multiple phases, where some facilities are phased out while others are still operational. This applies, for example, to the Ekofisk field, where investments are still being made in new facilities on the field, while other facilities are being removed from the field complex.

Larger and more extensive disposal projects must be carried out over several years. Frigg field is so far the largest field on the shelf  which its facilites has been decommissioned . The field consisted of a living quarters facility (QP), two process facilities (TP1 and TCP2) and two drilling facilities (DP2 and CDP1). Production ceased in 2004 and the offshore disposal work started in 2005. The extensive disposal work on the field was completed in 2010. In accordance with the OSPAR Convention, all topsides and steel jackets were removed from the field. What remains are two concrete jackets on the UK side and one on the Norwegian side. This is shown in the photo below.

Frigg
Frigg as it is today: TCP2 on the Norwegian side, TP1 and CDP1 on the British side. (Photo: Total)

The Norwegian Petroleum Directorate, together with the Petroleum Safety Authority Norway and the Climate and Pollution Agency, published a report that provides more information about technological challenges and factors related to HSE in connection with disposal of concrete facilities on the Norwegian continental shelf.

Disposal of small facilities

Smaller facilities, including subsea templates, must be removed in their entirety. One example of this is Nordøst Frigg, which was shut down in 1993 and was the first facility on the Shelf that would be removed. Two years later, the Storting made the disposal decision.

The authorities were concerned with reuse and consideration for the environment. The platform deck and control tower were moved to shore and now house a fitness centre at Tau in Rogaland County. The steel column and concrete foundation are used as a breakwater at the same location, while the subsea template was melted down and recycled.

Landing and scrapping/recycling

Facilities that will not be reused or abandoned on the field must be transported to shore and handled at an approved onshore facility for scrapping and recycling or disposal. In Norway, there are currently five onshore facilities that can accept installations or components of them:

  • AF Miljøbase Vats (Rogaland)
  • Kværner Stord (Hordaland)
  • Scandinavian Metall AS (Hordaland)
  • Lyngdal Recycling (Vest Agder)
  • Lutelandet Offshore (Sogn og Fjordane)

AF Miljøbase Vats – Installations landed from the Ekofisk Area

Download as image (PNG)

Photo: Ellen Marie Hagevik, Medvind24

AF Environmental Base Vats
Photo: Ellen Marie Hagevik, Medvind24

Disposal costs

The costs related to disposal of facilities are uncertain and vary from field to field. The largest cost elements in disposal projects are related to permanent plugging of wells and removal of the offshore facilities.

Cooperation between licensees, the service and supply industry, the authorities and affected interest groups is crucial for cost-effective disposal activities in the future. Innovation, technology development, experience and knowledge sharing are all important factors that can contribute to promoting cost-effective solutions.

Updated: 21.06.2017