Around 140 fields could cease production in the UK Continental Shelf over the next five years, resulting in a ramp-up of decommissioning activity and spend, according to a new report from Wood Mackenzie.
The research firm stated that a high oil price has enabled operators to extend field life and delay decommissioning on the UKCS, but warned that the current low oil price will lead to a change in behavior. Wood Mackenzie forecasts that around 140 UKCS fields will cease over the next five years, even if oil prices return to $85 per barrel.
Fiona Legate, UK upstream research analyst for Wood Mackenzie, commented in a Wood Mackenzie statement:
"Seventeen fields are expected to be sanctioned over the next five years. In the current price environment there is a risk projects may be cancelled or delayed. We could start to see a shift away from work in new developments to decommissioning projects…We expect around £54 billion [$82 billion]…will be spent on decommissioning on the UKCS and anticipate it to be completed in the early 2060s. Decommissioning spend is expected to increase by over 50 percent by 2019 and will overtake development spend in the same year.”
Have a news tip? Share it with Rigzone!
WHAT DO YOU THINK?
Click on the button below to add a comment.
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
More from this Author
Most Popular Articles
From the Career Center
Jobs that may interest you