Decommissioning and restoration: early planning is critical to an efficient and risk-minimised process

Abstract

Over the next 7 years, according to Wood Mackenzie, it is estimated that as many as 380 fields oil and gas facilities will be decommissioned across Asia–Pacific (Wood Mackenzie 2018). Many companies leave Decommissioning and Restoration (D&R) up to the respective project groups using their normal project management and control systems. However, managing D&R requires a different approach and mindset, as the value drivers and risk profiles for D&R projects are different compared to conventional construction projects. For D&R to be efficient – from operational, sustainability, regulatory compliance, environmental and financial perspectives – delivery must not be limited to an isolated project group. Rather, it must leverage corporate and operational knowledge, lessons learned from other decommissioning projects and industry best-practice to support the identification and management of the decommissioning risk profile and successful delivery thereof. Planning for D&R is essential at every stage of the life of an asset and should start as early as possible. Ideally, facilities are designed with D&R in mind at the project conception stage as the scope of D&R is often broader and more complex than operators realise, contributing to D&R projects often exceeding original cost estimates and timelines. Decommissioning and restoration opportunities may be missed or associated risks increased without timely recognition and management. In this paper, dss⁺ will provide companies with pragmatic guidance on how to plan and implement a D&R process that is managed well from an operational, risk, financial, contractor management and importantly, a stakeholder management point of view.