How sustainable are new oil rig decommissioning projects heading to Norfolk?
Two North Sea oil platforms are on their way to Great Yarmouth for recycling after a partnership between Veolia and oil industry logistics firm Peterson were awarded two platform decommissioning contracts to recycle rigs at Peterson’s facility in Norfolk.
The contracts include the onshore receipt and disposal of offshore materials and several assets for a ‘major gas producer’. The work will cover disposal options for a number of the oil production platforms currently located around 40 miles off the coast of Great Yarmouth.
The recycling process is predicted to take four years to complete and the partnership says that through the work it aims to establish Great Yarmouth as the southern North Sea’s centre for decommissioning, and to further expand the facilities to meet the ‘growing need’ for this type of decommissioning.
The partnership, which was first formalised in 2015, has been providing onshore decommissioning services for over 10 years, decontaminating and deconstructing oil platforms as well as providing waste management and environmental services.
To date, Veolia says that the joint venture has recovered over 80,000 tonnes of offshore materials. The new works are predicted to create approximately 10 new jobs, with further expansion and employment as the projects develop.
Minimise damage and recover valuable materials
An oil platform (or rig) can weigh 300,000 tonnes – the same as the Empire State Building – and its support structure has to be completely removed if it weighs less than 10,000 tonnes. Under a 15-nation protocol that came into force in the North Atlantic Ocean in March 1998, offshore platforms cannot be disposed of at sea or simply be left to rust and fall to pieces, as they risk damaging fragile marine ecosystems. Consequently, recovering the platforms at the end of their operational life is essential to minimise damage and recover valuable materials.
During decommissioning and recycling, the materials that the platforms contain can be carefully extracted and returned to industry for reuse, and where possible, assets that have further operational life can be sold, helping to boost the sustainability of the industry.
Commenting on the contracts, Simon Davies, Decommissioning General Manager of Veolia, said: “The industry has been looking for collaboration and these new contracts show collaboration in action right down the supply chain. Our partnership has worked well at a number of sites and projects over the last ten years, and we are very pleased to secure the first important contracts into Great Yarmouth.”
Oil rig decommissioning
With hydrocarbon reserves becoming depleted, oil and gas rigs are reaching the end of their productive lives and the emptier the wells get, the more costly it is to keep them running. Low oil prices also mean many oil fields are operating at a loss, and the added uncertainty following Britain’s vote to leave the EU means many more platforms are being shut down. Consequently, there is an increasing need to dispose of hundreds of the oil and gas platforms littering the North Sea.
The Oil & Gas UK Economic Report 2013 suggested that in the part of the North Sea known as the UK continental shelf alone there are 475 installations, 10,000 kilometres of pipelines and 15 onshore terminals that will at some point need to be decommissioned. The report also estimates that the total value of decommissioning across the North Sea is estimated to be £46 billion by 2040.
The rig’s sub-sea support structure can involve heavy concrete foundations or steel legs and frames that require specialist technologies to break up and remove, but the steel can be recycled relatively easily once it is retrieved. The smaller equipment has greatest potential for reuse as it can be extracted, refurbished and redeployed more easily.
However, according to a joint report by Zero Waste Scotland and the RSA Great Recovery project published in 2015, ‘very little’ reuse and remanufacturing that currently takes place during the decommissioning process, though ‘the potential value inherent in reuse of platforms has been shown to be significantly higher than recycling’.
A number of potential barriers to greater reuse within the industry have been identified, however, including: fear about the risks associated with using reconditioned materials; the bespoke design of each platform and the need to design for specific conditions; concern about the quality and conditions of materials that have been operating in extreme environments; the difficulty of recovering materials that haven’t been designed for reuse; and the drive to reduce costs of the decommissioning process.
ZWS is working to promote reuse opportunities within the industry, and Decom North Sea (DNS), a decommissioning organisation, is developing closer collaboration between North Sea operators and the decommissioning supply chain.
ZWS reports that in countries like the US, where barriers are being addressed, the reuse and remanufacturing of heavy equipment including on-shore oil and gas was worth $7.7 billion (£6.34 billion) in 2011 and that the market was growing.
The full Zero Waste Scotland and RSA Great Recovery report into North Sea oil and gas rig decommissioning and reuse can be read on the ZWS website.