Australia

Shelf Subsea have announced that the Southern Star, DPIII Saturation Diving Vessel, has arrived in New Zealand waters to commence work on phase 2 of the Tui decommissioning project.

The New Zealand Ministry of Business, Innovation and Employment (MBIE) awarded the contract to Shelf Subsea for the removal of the subsea infrastructure from the Tui Oil Field (phase 2 of the decommissioning process). This is the next step in the decommissioning of the field after the disconnection and demobilisation of the FPSO Umuroa was completed in May 2021.

The Southern Star, a 112m vessel with a 150t AHC crane, 1000m of back deck and installed WROVs. It arrived in New Zealand after encountering some poor weather, which was easily overcome.

Shelf Subsea noted that it is the most advanced DSV operating in the Asia Pacific region and comes with Port and Starboard SPHLs for greater driver safety and more efficient operations in blow-on, blow-off scenarios. As demonstrated on the journey over, the vessel handles exceptionally well in challenging weather conditions providing a stable platform for subsea intervention work.

Expanded remedial direction provisions for offshore petroleum titles, referred to as trailing liability, came into effect on 2 March 2022.

These expanded the Government of Australia’s powers to call back titleholders, former titleholders, related bodies corporate, and related persons of current or former titleholders, to perform remedial work on offshore assets if required. The provisions apply to titles as they existed on or after 1 January 2021.

The strengthened provisions ensure that the risks and liabilities of petroleum activities remain the responsibility of the petroleum industry. Trailing liability is intended as an option of last resort and is expected to be used rarely. The primary obligation to decommission remains with the current titleholder.

The Government has now released the trailing liability for decommissioning of offshore petroleum property guideline which will help to understand the scope of the trailing liability provisions and provides general information on how these provisions may be applied.

Find the guide here: https://www.industry.gov.au/data-and-publications/trailing-liability-for-decommissioning-of-offshore-petroleum-property-guidelines

D&A Aus 2022

From 10-11 May, the first ever Decommissioning and Abandonment conference will be arriving in Perth, Australia to provide the offshore community with the best blueprint for the wave of decommissioning projects on the horizon. For more information, download the brochure here: https://offsnet.com/da-aus/conference-brochure

Or contact:

Erin Smith

Global Accounts & Australasia Regional Manager

Offshore Network

t: +64 289 900 118

e: This email address is being protected from spambots. You need JavaScript enabled to view it.

To ensure planning and management of increased levels of decommissioning activity, the Australian Government has made changes to the offshore oil and gas decommissioning framework.

These enhancements were made after extensive consultation with the public, industry and regulators. The first of a suite of measures will come into force on 2 March, 2022. The updated guidelines will assist the offshore oil and gas industry to understand and comply with the changes. The measures will strengthen and build on existing provisions in the Offshore Petroleum and Greenhouse Gas Storage Act 2006 (OPGGS Act) and regulations.

Policy, legislation and regulatory enhancements cover three themes – financial oversight, planning and management, accountability and trailing liability. Work is on to implement enhancements to the decommissioning framework over the coming years.

Changes to the legislation

The first stage of implementation included legislative amendments. The Offshore Petroleum and Greenhouse Gas Storage Amendment (Titles Administration and Other Measures) Act 2021 (Titles Administration Act) gives effect to key measures of the enhanced decommissioning framework. It also implements relevant recommendations from the independent Walker Review into the administration and liquidation of Northern Oil and Gas Australia.

The Titles Administration Act increases oversight of changes in titleholder control, expands existing trailing liability provisions, increases regulatory scrutiny of the suitability of companies operating, or looking to operate, within Australia’s offshore petroleum regulatory regime and expands information-gathering powers.

To give full effect to the changes in titleholder control and trailing liability measures, amendments were made to The Offshore Petroleum and Greenhouse Gas Storage (Regulatory Levies) Act 2003 (Levies Act) and Regulations under the OPGGS Act and the Levies Act.

Under these amendments, a person who receives a remedial direction will need to comply with the same regulatory requirements as a titleholder. This includes environmental management and safety requirements. The amendments also include changes that enable the regulator and titles administrator to recover the costs associated with administering these measures. This means anyone receiving a remedial direction or applying for a change in titleholder control will need to pay associated levies and fees.

D&A Aus 2022

From 10-11 May, the first ever Decommissioning and Abandonment conference will be arriving in Perth, Australia to provide the offshore community with the best blueprint for the wave of decommissioning projects on the horizon. For more information, download the brochure here: https://offsnet.com/da-aus/conference-brochure

Or contact:

Erin Smith

Global Accounts & Australasia Regional Manager

Offshore Network

t: +64 289 900 118

e: This email address is being protected from spambots. You need JavaScript enabled to view it.

The Australian Securities & Investments Commission (ASIC) has taken note of the additional US$239mn that Woodside Petroleum Limited (Woodside) has provided for its decommissioning requirements.

In its financial report for the year ended 31 December 2021, Woodside estimated that the extra costs would primarily come from the removal for rigid plastic-coated pipelines.

ASIC continued that Woodside has also improved its disclosure of the basis to provide for future restoration costs. This includes disclosing the types of offshore and onshore infrastructure assets for which full removal has been provided; that full removal has not been provided for certain pipelines and infrastructure, parts of offshore platform substructures, and certain subsea infrastructure; and an indication of the additional costs if certain items for which full removal has not been provided for are not exempted from full removal by The National Offshore Petroleum Safety and Environmental Management Authority.

Although acknowledging the extra capital that was being observed, ASIC, as part of its financial reporting surveillance programme, also raised concerns about the offshore infrastructure assets that were not included for full removal in the restoration provision in Woodside’s financial report for the year ended 31 December 2020, and the adequacy of related disclosures. ASIC said that it is continuing its inquiries about why Woodside did not allow for the full removal of certain infrastructure assets in its financial report.

D&A Aus 2022

From 10-11 May, the first ever Decommissioning and Abandonment conference will be arriving in Perth, Australia to provide the offshore community with the best blueprint for the wave of decommissioning projects on the horizon. For more information, download the brochure here: https://offsnet.com/da-aus/conference-brochure

Or contact:

Erin Smith
Global Accounts & Australasia Regional Manager
Offshore Network
t: +64 289 900 118
e: This email address is being protected from spambots. You need JavaScript enabled to view it.

Esso Australia, a subsidiary of ExxonMobil Australia, has entered into a multi-year agreement with DOF Subsea to charter a Multi-Purpose Supply Vessel for the support of its decommissioning activities in Bass Strait.

Dylan Pugh, ExxonMobile Australia Chair, said that the subsidiary is committed to safely decommissioning the Bass Strait offshore facilities and over the last few years has completed around US$600mn of early decommissioning works in the strait, including removing the Seahorse and Tarwhine facilities, completing P&A activities on Blackback and Whiting wells, and making significant progress on Kingfish B and Mackerel.

“As we continue to progress these important, early decommissioning works, we are also planning for the eventual decommissioning of our facilities that are to cease production in the near future,” Pugh commented.

The DOF Subsea vessel is expected to arrive in Bass Strait in the middle of 2022 where it will support early decommissioning works on the Perch and Dolphin facilities before moving onto other topside and subsea work scopes.

Pugh added, “We continue to assess new projects in Bass Strait with the aim of extending our production of Gippsland gas into the next decade.”

“Just last year we commissioned West Barracouta, one of the largest domestic gas projects this decade. As it showed, there is still potential left in Bass Strait and we are working hard to unlock its full value so we can continue to deliver the gas Australians need.”

Using Wire Arc Additive Manufacturing (WAAM), Vallourec has recently produced two lifting plugs for Weatherford with meet its urgent operational demands.

When Weatherford approached Vallourec with an urgent request for a VAM TTR HW Riser Lifting Plug capable of 100T for a customer’s workover scope off the coast of Australia, Vallourec proposed a more economical and faster solution using Additive Manufacturing (AM) in order to meet the deadline.

The lifting plugs were re-designed with WAAM to include tailor-made non-standard diameters that were compatible with Weatherford’s existing equipment. The lifting plugs’ outside diameter (OD) was therefore increased by 15% as per the customer’s request. Leveraging WAAM’s flexibility, Vallourec was able to mitigate any weight increase by re-designing the component without impacting lifting performances.

The 3D-printed safety-critical components weighed 175kg each with a tailor-made diameter of 50cm and were designed for load carrying applications of around 100 metric tons.

These new lifting plugs were 3D-printed with the Vallourec WAAM robot located in Singapore, only a six-hour flight away from the end-customer. The safety-critical components were delivered in just under two months instead of the usual three to four months.

“We approached Vallourec with an urgent request for a lifting plug for a customer of ours operating in the Timor Sea. Their solution was to use WAAM, a more economical and quicker option to the traditional route”, explained Shane Ferguson, Project Manager for Weatherford. “They executed this on time and delivery was made well before operations commenced. We were extremely happy with the finished product and will look to Vallourec and this method for future requirements.”

WAAM – and AM more widely – offers numerous benefits for the oil and gas industry, one of the most important being shorter, guaranteed lead times, which would make a huge difference to end users. WAAM also allows for greater freedom of shape – parts can be created to the exact size and specifications of each customer – as well as for printing of very large components. The ultimate benefit of this process is to allow companies to create a digital or virtual warehouse through which they can order spare parts as a printable file.

Thanks to WAAM, Vallourec is able to eliminate the traditional concerns regarding the unpredictability of material sourcing and minimum order quantity requirements, providing customers with solutions meeting their specific requirements any time.

“We look forward to making possible future projects such as this one, providing customers with the high quality they are used to from Vallourec with faster delivery times”, commented Jinwei Li, Asia Pacific Sales Manager at Vallourec.

The New Zealand Ministry of Business, Innovation and Employment (MBIE) has entered into an agreement with Helix Offshore Services Limited, a subsidiary of Helix Energy Solutions Group, for the plugging and abandonment (P&A) of the wells in the Tui Oil Field.

This is part of Phase 3 of the Tui Oil Field decommissioning.

“Helix was awarded the contract after a competitive procurement process to select a supplier that met MBIE’s objectives of a robust technical solution, flexibility in timing, competitive pricing and a commitment to working with iwi and local stakeholders,” said MBIE Tui Project Director, Lloyd Williams.

“Helix is widely recognised internationally as one of the largest and most capable contractors for well intervention and abandonment, and we are looking forward to working with them to complete the final phase of the decommissioning."

“Helix’s proposed vessel to carry out the work, the Q7000, is a state-of-the-art unit which is optimised for well decommissioning and features specialised equipment required to complete the work safely and efficiently,” added Williams.

Wharehoka Wano, CEO of Te Kāhui o Taranaki Trust, remarked, “We are very pleased the project has secured a highly competent contractor for Phase 3. This gives us every confidence as Taranaki Iwi and the hapū of Ngāti Kahumate, Ngāti Tara, Ngāti Haupoto and Ngāti Tuhekerangi as kaitiaki, to fulfil and maintain our responsibility and obligation of ensuring the mouri of our environment and cultural resources are protected and enhanced for future generations.”

The disconnection and demobilisation of the FPSO Umuroa, the first phase of the decommissioning of the Tui Oil Field, was completed in May 2021. In October 2021 the contract for the second phase of the decommissioning process, the removal of the subsea infrastructure, was awarded to Shelf Subsea Services Pte Limited. It is anticipated this phase of the work will be carried out in the summer of 2021/22 or alternatively in the summer of 2022/23.

MBIE has submitted an application for marine consents with the Environmental Protection Authority (EPA) for the removal of the subsea infrastructure and the plugging and abandoning of the Tui wells. An independent board of inquiry is considering MBIE’s application.

Subject to EPA granting the marine consents, it is anticipated the plugging and abandonment work will be carried out from late 2022.

The Centre of Decommissioning Australia (CODA) has appointed six industry leaders to form the organisation’s Supervisory Committee to bring increased strategic focus and expertise to the efforts to address decommissioning Australia’s aging oil and gas infrastructure.

CODA, which was established in March 2021, is uniquely positioned to drive collaboration in Australia’s oil and gas industry to collectively answer strategic questions about decommissioning options based on technical, safety and environmental knowledge. CODA's research shows there is more than $50bn of necessary offshore decommissioning work to be done — over half of which is anticipated to be started within the next ten years.

Francis Norman, CODA General Manager Decommissioning and Strategy, said the committee’s appointment marked a change of gear for CODA. He noted, “The support and input from a group of such experienced and engaged industry leaders will help accelerate CODA’s ability to work across the whole of Australian industry to build our domestic capability to address our own decommissioning needs, as well as position Australia to become a significant partner in the region’s decommissioning work.”

The committee consists of:
• Richard Perry — Decommissioning Manager, ExxonMobil Australia
• David Banks — Chief Technical & Marketing Officer, Santos Ltd
• Jay Southwell — APAC Subsea Services leader, Baker Hughes
• Brian Matthews — Marine, Subsea & Automation Manager, IAS Group
• Ineke Reyboz — Contracts and Commercial Consultant (independent member)
• Harvey Johnstone — Environment Director, International Association of Oil & Gas Producers (independent member)

“By applying research from the National Decommissioning Research Initiative, we and our industry partners will ensure Australia's future decommissioning activity will be built on independent and sound scientific research, providing the best possible outcomes for industry, environment and community,” said Norman.

Richard Perry, Decommissioning Manager, ExxonMobil Australia, said, “After an extensive history of successful resource development and energy supply across Australia, our national fields are starting to reach the end of their productive life leading to the dawn of a new industry, and with it, some fantastic opportunities.

“With the broad geographical expanse between major basins in Australia, CODA will be a crucial conduit to enable growth of this industry to be optimised for all parties throughout the supply chain and it is very exciting to be part of this journey.”

Jay Southwell, APAC Subsea Services leader, Baker Hughes, added, “The decommissioning era within Australia is swiftly gaining momentum, but it’s a complex subject. Strategic complexity requires an evolution in the way we share project and service information.

“With the launch of CODA, we now have a great opportunity to collaborate, share best global practices and make a real difference to support the Australian decommissioning sector to permit the safe removal of assets without impacting the environment.”

Contracts for CODA foundation phase projects have been recently awarded. Due for delivery in early 2022, these projects will build knowledge and understanding of the local decommissioning and recycling capability, provide Australian industry with an easily accessible digest of international best practice that can be used locally, and set out a pathway for innovation and new technologies for the industry. These include:

• Understanding the opportunity for local disposal and recycling pathways — Advisian
• Development of a decommissioning innovation and technology roadmap — Linch-pin
• Global review of decommissioning planning and execution learnings — Advisian