Decommissioning – the next Australian oil and gas boom?
Bernadette Cullinane A C and Susan Gourvenec BA Deloitte Consulting Pty Ltd, Tower 2, Brookfield Place, 123 St Georges Terrace, Perth, WA 6000, Australia.
B Centre for Offshore Foundation Systems & Offshore Floating Facilities (OFFshore) Hub, University of Western Australia, 35 Stirling Highway, Crawley, WA 6009, Australia.
C Corresponding author. Email: bernadettecullinane@deloitte.com.au
The APPEA Journal 57(2) 421-425 https://doi.org/10.1071/AJ16203
Accepted: 27 March 2017 Published: 29 May 2017
Abstract
In the Oil and Gas Competitiveness Assessment recently published by National Energy Resources Australia (NERA), Australia ranked at the bottom of the group of 30 oil and gas producing nations in abandonment and decommissioning (NERA 2016).
With the recent focus on the massive investment in liquefied natural gas (LNG), it is easy to forget that the Australian oil and gas industry is nearly 100 years old and many assets are reaching the end of their producing life. Liabilities are estimated at more than US$21 billion over the next 50 years (Wood Mackenzie 2016a). With nearly 70% of producing assets located offshore, this problem is complex and costly.
The industry must develop strategies to address this looming challenge, however Australia has completed few large-scale decommissioning projects and currently lacks the required experience.
This paper explores how Australia must:
evaluate a range of approaches from complete removal to allowing assets to remain in situ;
develop multi- and interdisciplinary solutions based on the collaborative input of all stakeholders and ocean users to develop a framework suited to our geographic location and environment;
develop fit-for-purpose policies and regulations to support the most appropriate decommissioning framework for Australia, by learning from other countries, while recognising local uniqueness; and
build workforce capability and capacity to support efficient and economical decommissioning activities and stimulate economic growth, which is more challenging than in other regions given our remoteness and high cost structure.
The upcoming decommissioning wave represents a perfect ‘greenfield’ opportunity to apply innovative thinking, new technologies and collaborative approaches as well as an opportunity for Australia to demonstrate global leadership in this inevitable final stage of the lifecycle.
Keywords: industry competitiveness, LNG, offshore.
Bernadette Cullinane is Deloitte’s Australian National Oil and Gas Practice Leader and LNG Leader. Throughout her career Bernadette has helped companies improve their business, financial and operational performance. She has more than 25 years of experience across the oil and gas value chain and all stages of the capital project to operations lifecycle. |
Susan Gourvenec is a Professor at the Centre for Offshore Foundation Systems and the Offshore Floating Facilities Research Hub at the University of Western Australia. Susan has 15 years of offshore engineering experience with particular interest in offshore geotechnics. She is a consultant offshore geotechnical engineer to industry and member of the ISO and API Committees for offshore geotechnics. Susan is currently leading an initiative to develop a multisector, multidisciplinary, multivariate approach to offshore oil and gas decommissioning. |
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