Australia

Jadestone Energy plc, an independent oil and gas production company headquartered in Singapore, has announced the Montara Venture FPSO offshore Australia restarted production operations last week.

Following what the company called a ‘carefully planned’ restart programme, production recommenced from the H6 well within the Montara field, with further wells set to follow, including the first Skua subsea well.

With the systematic opening of additional wells in line with the restart plan, production rates are set to increase, and the company will announce its production guidance for 2023 once output has stabilised.

Paul Blakeley, President and CEO at Jadestone Energy, said, “I would like to thank everyone in Jadestone who has contributed to the safe and successful restart of Montara operations as well look forward to putting this challenging period behind us and returning to business as usual.

“It is a relief to see operations at Montara being restored and we look forward to increasing production and cash flow. We also plan to return to growth, having completed three acquisitions within the last six months, with several new acquisition opportunities in the pipeline.”

The restart programme was instigated after the initial shutdown of production in July 2022 after a small leak from the crude oil tank aboard the FPSO was detected and required permanent repair.  

Pressing climate concerns and an overall healthy oil price across 2022 have set the stage for Australia's decommissioning industry to flourish, according to a new report published by Offshore Network.

Reports estimating that oil prices through 2027 will stay at a healthy rate of approximately US$90 per barrel bodes well for the decommissioning industry as companies can consider liability expenses even more open-handedly.

The government-backed Northern Endeavour project has triggered a flurry of decommissioning prospects to swing into action; a trend that is expected to continue over the next few years. Because of this, promising engineering companies like Wood and Monadelphous are being shot into the limelight, as the government onboarded them for various roles on the Northern Endeavour decommissioning.

Companies like Santos, Woodside, BHP and Vermillion Energy have signed up for kick-starting end-of-life activities, with ExxonMobil leading the way. Chevron has ongoing decommissioning projects onshore and offshore at Thevenard Island, which was rendered inactive in 2014. NOPSEMA has granted decommissioning approval to companies like Woodside, BHP and Cooper Energy early last year. Decommissioning activities in the Enfield Oil Field are being conducted by Woodside in phases, and is expected to be completed by 2024. Australia is financing research initiatives and organisations are tying up to tackle the challenges of decommissioning through knowledge sharing. Xodus, along with ANSTO, SA Radiation, Total Hazardous Integrated Solutions and Qa3, form the Contaminant Advisory Group that helps operators to work through the government’s OPGGS bill.

This flurry of activity has been prompted by a government determined to ensure that decommissioning responsibilities are carried out. The new Offshore Petroleum and Greenhouse Gas Storage Amendment (Titles Amendment and other Measures) Act 2021, makes sure the entities intending to carry out petroleum or greenhouse gas activities are capable, competent and responsible in proper discharge of obligations under the act.

The Centre of Decommissioning Australia (CODA) has estimated the decommissioning expenses of the Australian oil and gas industry to reach as high as US$40.5bn, considering the nation's significant asset stock. According to a report by Rystad Energy, 890 offshore wells in total were drilled in Australia before 2015, of which 108 have been permanently abandoned. Around 440 wells are P&A candidates, the majority of which are in the Gippsland Basin.

Based on the identified numbers, CODA has come up with a comprehensive liability report, to serve as the go-to manual for operators when it comes to making smart economical choices. Critical to this, as stressed by Francis Norman, CEO and Managing Director of CODA, is the importance of collaborative campaigning and in-situ decommissioning as effective cost-cutting measures.

Players like CODA are guiding the Australian decommissioning industry through the climate conundrum through strikingly innovative approaches. One of them is the rig-to-reef concept, which involves a special combination of materials that resulted in the Exmouth Integrated Artificial Reef, better known as the 'King Reef' in the Exmouth community. It combined 49 purpose-built concrete modules with six steel structures from a BHP-operated field that is no longer in use, providing home to 27,000 cu/m of new marine habitat. As incredible as that sounds, operators must have clarity about the risks involved as well, so that they can keep pushing barriers through innovation.

With every stakeholder working in tandem and taking onboard lessons from other more developed regions, the Australian industry can ensure that the forthcoming decommissioning wave can be weathered.

Download the full, free-to-read report to understand the size and scope of the decommissioning outlook in Australia as well as the unqiue opportunities that will be unlocked as the wave continues to break. 

Esso Australia, a subsidiary of Exxonmobil Australia, has entered into an agreement with Helix Energy Solutions to charter the Helix Q7000 semisubmersible vessel to support decommissioning activity across the Gippsland Basin.

The vessel will join Esso Australia’s growing fleet, with its roster of mobile offshore assets now including Rig 22, the HWT600 and a DOF Subsea Multi-Purpose Support Vessel.

Dylan Pugh, ExxonMobil Australia’s Chair, said, “The Helix Q7000 is a welcome addition to our extensive fleet of vessels and rigs currently operating across the Gippsland Basin. It is the forth mobile offshore asset we have added to our decommissioning fleet, and marks the first time we will be using a light well intervention vessel for subsea work locally.

“We are committed to sourcing the right assets for the work we are completing, given the variety of fields we have operated for over 50 years. Our priority is to remain safe, whilst using fit for purpose solutions which ensure we are meeting our decommissioning requirements.”

The Helix Q7000 is set to support decommissioning activities in Bass Strait from the end of 2023.

Well-SENSE, a downhole sensing specialist, has deployed its FiberLine Intervention (FLI) technology at a large carbon capture and storage (CCS) facility, in an industry-first application.

FLI has already been well-proven in a variety of seismic, acoustic and temperature monitoring applications in the oil and gas sector and has just completed its first geothermal well survey for Eden Geothermal in Cornwall.

The fibre-optic monitoring system has since been deployed for a leading integrated energy operator in Australia and marks the first time that fibre has been used to survey live CCS wells and reservoirs.
The new application in the carbon sequestration sector provides a safe, low-risk monitoring solution in a highly corrosive CO2 environment where traditional intervention solutions are often detrimentally affected.

The energy operator employed FLI in a field trial to study well integrity, CO2 flow characterisation and plume movement within the reservoir. FLI’s distributed temperature sensing (DTS) enabled assessment of the reservoir zones, while its distributed acoustic sensing (DAS) simultaneously acquired vertical and passive seismic data.

Annabel Green, CEO at Well-SENSE, commented, “Our FiberLine Intervention system was selected by this leading operator, to be evaluated as a potential alternative to the use of wireline production logging tools. Our system’s advantages include its extremely compact rig-up, much lighter surface pressure control equipment which uses a static rather than a dynamic seal and a simpler deployment method compared to conventional techniques. FLI also uses a bare fibre that is impervious to the corrosive effect of CO2, which helped to make this intervention possible.

“Several challenges were overcome efficiently, including the requirement to leave the fibre in the well for four days with exposure to strong fluid cross flows, the requirement for immediate Cloud data transfer from the wellsite to the operator’s technical centre and servicing a remote wellsite near live infrastructure. We are delighted that operations were performed incident free with no major NPT events and that our unique technology provided valuable, high-quality data from multiple wells.”

The decommissioning of the Northern Endeavour facility has reached a significant milestone as contractor Petrofac Facilities Management Limited (Petrofac) has begun Phase One of the decommissioning process.

The process will see the Northern Endeavour disconnected from subsea equipment and the suspension of the oil wells.

The facility is moored in the Commonwealth waters in the Timor Sea, between the Laminaria and Corallina oil fields. It stopped oil production in 2019, after being shut down by National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) for immediate breeches in health and safety.

“The Australian Government remains committed to the successful decommissioning of the Northern Endeavour, the removal of infrastructure and the remediation of the Laminaria and Corallina oil fields,” said Madeleine King, Minister of Resources and Northern Australia.

“Petrofac taking operational control is a significant step in the decommissioning process.”

The US$355mn contract was drawn up with Petrofac in March 2022 to deliver the first phase of the decommissioning project.

Engineering company Monadelphous Group Limited has secured a contract to provide operations, maintenance and industrial services to support Petrofac in the decommissioning of the Northern Endeavour Floating Production, Storage and Offtake (FPSO) facility.

The Northern Endeavour is a 274 m long FPSO, permanently moored between the Laminaria and Corallina oilfields, approximately 550 km northwest of Darwin in the Timor Sea. Production began in 1999 and peaked at 170,000 barrels of oil per day.

In 2019, the facility was shut down by NOPSEMA after an immediate threat to health and safety was found at the facility. After owners Northern Oil & Gas Australia went into liquidation, it fell to the Government to maintain and ultimately decommission it.

Petrofac was contracted earlier this year as outsourced operator responsible for decommissioning and disconnection of the FPSO. The scope includes the provision of its unique integrated services, working with both local and global suppliers.

The support to Petrofac represents Monadelphous’ first offshore decommissioning contract with work expected to be completed in the second half of 2023.

It represents a host of new contracts and contract extensions awarded to Monadelphous totalling approximately US$160mn.

As part of the early decommissioning works in Bass Strait, Esso Australia’s wells team is moving to the next stage of plug and abandonment work, applying key learnings from the recently completed conductor removal operations on Kingfish B and Mackerel.

Following its successful work at Kingfish B, Rig 22 will now be utilised for plug and abandonment activities at the non-producing platform, Flounder.

“The professional crew deployed with Rig 22 safely and efficiently completed operations at Kingfish B. The results proved the combination of our capable workforce and the refurbished Rig 22 can deliver world class performance for plug and abandonments,” said Wells Operations Superintendent, Ryan Turton.

“We now have a long programme ahead, and we are excited to further optimise our processes and continue to responsibly meet our plug and abandonment obligations.”

The team is also preparing for the arrival of the DOF Multi-Purpose Support Vessel (MPSV) Skandi Darwin, which is arriving at the Barry Beach Marine Terminal early August.

“One of the MPSV’s first tasks will be to support works at our steel gravity based monotowers, Dolphin and Perch,” said Matt Barney, Marine Field Superintendent.

The MPSV provides a floating support asset that will allow the complete abandonment operations on our non-producing facilities which do not have accommodation based on them.

“The MPSV hosts the workforce and means we don’t have to fly workers in and out of the area each day,” said Matt.

“We’re excited to start utilising the MPSV to expand our capabilities and adopt new technology to identify efficiencies, while ensuring the work can be completed safely.”

Heerema has been awarded a decommissioning contract by Woodside Energy that includes the integrated engineering, preparation, removal, and transport of the Nganhurra riser turret mooring (RTM).

For the project, Heerema will remove the RTM from the Enfield field, located approximately 52 km northwest of Exmouth in Western Australia, by lifting the structure in one piece onto a barge and transporting it o Henderson or another suitable Australian port for dismantling, and recycling or reuse.

Jeroen van Oosten, Heerema’s Chief Commercial Officer, commented, “We are proud to be Woodside Energy’s contractor of choice for removing the Nganhurra RTM. This contract represents our first decommissioning project in Australia and although Heerema has a long history of safely and sustainably removing offshore structures from the North Sea and Gulf of Mexico, we are very excited to continue our responsible decommissioning operations in Australian waters.”

Heerema is looking forward to taking an active role in Australia’s decommissioning ambitions. The removal and subsequent reuse or recycling of offshore infrastructure is an essential final step in the lifecycle of oil and gas infrastructure and aligns with our company values of responsibility, sustainability, and contributing to a circular society.”