Offshore Industry

(asked on 9th December 2021) - View Source

Question to the Department for Business, Energy and Industrial Strategy:

To ask Her Majesty's Government what assessment they have made of the costs of decommissioning (1) existing oil and gas infrastructure, and (2) extant oil and gas licences which have not yet been granted planning approval.


Answered by
Lord Callanan Portrait
Lord Callanan
Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)
This question was answered on 20th December 2021

According to the Oil and Gas Authority’s ‘UKCS Decommissioning Cost Estimate 2021’ report (copy attached), the total cost of decommissioning UK Continental Shelf offshore oil and gas infrastructure has reduced to £46bn[1] equating to a projected saving of nearly £14bn (23%) since the 2017 cost reduction target[2] was first established.

With extant oil and gas licences which have not yet been granted planning approval, we do not know which will be developed, so it is not possible to say how much they will cost to decommission, although the Oil and Gas Authority’s UK Continental Shelf full portfolio estimate referenced in the report attached includes £2bn for planned but as yet unsanctioned/not-built projects.

[1] Costs shown in 2016 prices, for expenditure in 2017 and after

[2] Basis of 2017 estimate, 2016 Annual OGA Stewardship survey

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