Allseas has awarded Modern American Recycling Services Europe (MARS) with the contract for project management and engineering, receipt with load-in assistance, dismantling and disposal of EnQuest’s Heather Alpha topsides.
The contract was announced on MARS’ social media platforms, and will provide the chance for the company to participate in the decommissioning of the 13,000 t topsides.
As part of the project, EnQuest will make use of Allseas’ Pioneering Spirit, a 48,000t offshore construction vessel that is designed for single-lift installation and removal of offshore platforms as well as the installation of record-weight pipelines. The ship has proven its ability to lift entire topsides of up to 48,000 t and jackets up to 20,000 t in a single piece.
The vessel will be used to remove the Heather topsides in a single lift operation. Preparations for the lift will begin next year, with the lift itself scheduled for 2025.
Following this work, in subsequent years, M.A.R.S. will recycle the platform in compliance with international, national and local rules and regulations.
As operators are racing to keep their heads above water as the energy transition continues to grow in momentum, instability in energy security is adding fuel to the fire and putting Europe’s energy market in jeopardy. Following the turbulent oil market over the past three years and the sanctions issued against Russia, heads are beginning to turn to geothermal to meet the rising demand for heating systems across the continent.
Scaling geothermal heating sources in Europe could fundamentally provide not only a big stepping stone for meeting environmental targets, but also implement a more established level of energy security regionally. For the first time, policymakers are integrating geothermal movements into frameworks and governments across the continent are increasing funding for pilot projects.
The geothermal scene is hotting up, however, a number of challenges are still holding the industry back from reaching its full potential. High financial barriers appear too big to scale with the current resources available, with international players hesitant to invest in the European market. Collaboration between geothermal experts and the oil and gas community is key to bridging the gaps presented in the market and could be the key component to utilising geothermal energy to ensure energy security.
Read Offshore Network’s full report here to understand the current state of play within the European geothermal industry and hear from experts as they share their insights into how the market can receive the boost it needs to ensure regional environmental targets are met and that energy security is assured.
Relatively stable oil prices and a growing global oil demand is creating favourable dynamics for the oil and gas community in the near-future, however uncertainty is rife over how long this will last as the race to meet the Paris Agreement 2050 target intensifies.
While this is raising questions over further drilling activity offshore Australia, it is suggesting a promising future for the country’s well intervention market as operators seek to squeeze the last drops of oil out of existing assets and perform end-of-life work in preparation for the substantial decommissioning task ahead. At the same time, the offshore carbon capture and storage space is garnering significant interest and marks another tantalising frontier that is receiving Government backing.
Read Offshore Network’s full report to understand the background and nuances of Australia’s offshore well intervention market as well as the potential challenges (such as labour shortages and vessel availability) which threatens to stifle it.
McDermott has been awarded an engineering, procurement and removal contract for offshore decommissioning work by Woodside Energy.
The award is for the full removal of the Stybarrow disconnectable turret mooring (DTM) buoy, as part of the decommissioning of the Stybarrow field located in the north-western Cape of Western Australia.
Under the contract scope, McDermott will provide project management and engineering services for the recovery, transportation and offloading of the DTM buoy to an onshore yard for dismantling and disposal.
Mahesh Swaminathan, Senior Vice President, Subsea and Floating Facilities, McDermott, said, “This award not only demonstrates McDermott’s proven track record in undertaking deepwater projects of diverse scopes, but it also highlights the critical importance of decommissioning in the offshore industry.
“With our seamless integration of engineering, fabrication, and offshore mobilisation expertise, we believe we are well-equipped to execute this project efficiently and responsibly, ensuring the safe recovery and removal of the Stybarrow DTM buoy.”
The DTM buoy will be removed utilising McDermott’s DLV2000 vessel, with the Perth-based team overseeing project management while engineering and fabrication support will be provided by the team in Kuala Lumpur, Malaysia, and Batam, Indonesia.
Global energy consultancy Xodus has been awarded a contract to provide technical and project support services for Phase One of the decommissioning of the Northern Endeavour FPSO.
Phase One covers activities to facilitate the disconnection and removal of the FPSO including topsides and subsea flushing and well suspension.
Xodus will be working on behalf of the Australian Government, providing advice and project coordination, regulatory and environment, health and safety, technical, quality assurance, and contract management as part of the agreement.
Alasdair Gray, Late Life and Decommissioning Lead at Xodus, said, “We have a highly experienced local team with several of our colleagues having extensive experience of the Northern Endeavour either from the early design and installation phase of the project or during production operations. This means that whilst being able to bring a fresh approach, the facility is already familiar to much of the team.
“We understand environmental sensitivities and the impact these can have on any proposed activity or execution plan. Expert technical advice and careful planning will be critical to the successful decommissioning of the offshore field in a safe and responsible manner. We are pleased to provide the necessary support to ensure that the decommissioning strategy is robust and ultimately compliant with regulatory expectations.”
The Northern Endeavour is a 274 m long FPOS which is permanently moored between the Laminaria and Corallina oil fields in the Timor Sea. The now redundant production system comprises a network of subsea wells tied back to the permanently moored vessel unit through a system of subsea manifolds, flowlines, umbilicals, and dynamic risers.
Trendsetter Engineering, a provider of specialised subsea hardware and offshore service solutions from exploration drilling through to abandonment, has announced the recent completion of two deepwater well stimulation campaigns for major operators in the Gulf of Mexico.
The two campaigns resulted in the successful acid treatments of a combined six wells. The campaigns arrived on the heels of a contract agreement to deliver hydraulic intervention and technical services via the Subsea Tree Injection Manifold (STIM) for a Hydrate Remediation and Flowline Flush Project in the Gulf of Mexico.
The Trendsetter STIM offers a 15,000psi rated subsea safety system designed to provide hydraulic well access for both vertical and horizontal tree types. In addition to hydraulic well stimulation, the STIM unit has been used and is capable of supporting various other hydraulic intervention operations including hydrate remediation, bull heading of kill weight fluid and cement as well flowline flushing and testing operations for both pre and decommissioning.
According to Rystad Energy, the well intervention market is receiving a healthy boost as oil and gas companies look to increase their output.
The research and business intelligence company claimed that spending on interventions is projected to jump by almost 20% in 2023 to total US$58bn and this is just the start of a surge in the coming years.
The intervention rate is forecast to reach 17% in 2027 which would total about 260,000 wells globally.
Breaking this down, Rystad showed that more than US$11bn of the total expenditure will be directed to the wireline & perforating segment, while together, intervention units and oilfield chemicals sectors will represent 35%. In addition, the sum of the investments in coiled tubing, water management, and intervention tools is expected to close 2023 surpassing US$20bn.
Regionally, onshore interventions in Asia, South America, and Africa will lead the 9% growth in activities related to intervention during 2024, a year expected to be significant for the well intervention market. North America is projected to account for 64% of the total oil and gas wells ready for intervention in 2027, whereas Asia and South America will reach their maximum in 2026, with respectively 41,413 and 9,703 wells.
Jenny Feng, Supply Chain Analyst at Rystad Energy, explained, “As oil demand picks up in the second half of this year, operators will look to ramp up production from existing fields, and well interventions will be a vital piece of the puzzle. As a quick, efficient, and cost-effective method of maximizing existing resources, interventions are going to be a hot topic in the years to come.”
In terms of offshore markets, 618 assets are highly attractive for intervention. Norway and Australia stand out with 36% and 25%, respectively, while the UK has 91 wells likely to be involved in intervention activities.
Decom Engineering (Decom) has invested more than UK£1mn to develop its largest chopsaw to date.
The C1-46 Chopsaw has been delivered in response to client demand for larger sized subsea pipe-cutting capability. It is designed to cut tubulars and other materials up to 46” and is able to cut a wide range of materials, including inconel alloys, duplex and concrete.
With the ability to cut in any orientation, the C1-46 is capable of multiple cuts per blade (20-100), resulting in large cost savings and increased efficiency. Blade changes are efficient, safe and the chopsaw can be supplied set up in a number of configurations and settings to suit project requirements.
It can be operated in water depths of up to 2,000 m and is currently deployed on its first project on behalf of a global energy company on a UK North Sea workscope.
The solution is able to achieve a versatile angle of deployment and an array of cuts can be completed whilst subsea or held in wet storage, without returning to the surface. The Tungsten Carbide Tipped saw, which can be operated topside or by ROV (with hot stab capability), is highly adaptable to suit challenging surroundings and varied structures.
Decom Engineering Managing Director, Sean Conway, commented, “Our commitment to research and development is a differentiator and making this significant investment to bring the C1-46 Chopsaw to market was a result of clients indicating they would welcome larger sized cutting options, as this is an area existing technologies struggle with.
“Decom are focused on supporting clients in solving their problems by asking how we can do more. This flagship product is designed for large subsea cutting operations and can cut through tough exotic materials and thick coatings with ease, while maintaining clean cuts for easy access to flush pipelines or recycle pipes.
“The saw clamps are designed to penetrate into the sea bed/sediment and to minimise the need for trenching. We are excited to see the C1-46 perform successfully on this North Sea project and we will take the lessons learned to refine and improve the product and its operational capabilities.
“Given the strong track record of success with our other models of the C1 Chopsaw we are confident that this latest version will perform well and will meet client expectations but we are always looking for ways to improve our offering.”
Valaris has secured new contracts and contract extensions to leave its associated contract backlog at approximately US$150mn.
The new scope includes:
• A two-well contract with Anadarko Petroleum Corporation in the U.S. Gulf of Mexico for semisubmersible VALARIS DPS-5. The contract is expected to commence in July 2023 and has a minimum duration of 60 days.
• A nine-well contract for a plug and abandonment campaign with Apache in the U.S. Gulf of Mexico for semisubmersible VALARIS DPS-5. The contract is expected to commence in September 2023 and has a minimum duration of 110 days.
• A minimum duration 180-day contract with an undisclosed operator offshore Australia for heavy duty modern jackup VALARIS 107. The contract is expected to commence in first quarter 2024.
• A one-year contract with an undisclosed operator offshore Australia for heavy duty modern jackup VALARIS 107. The contract is expected to commence in October 2024.
• A two-well contract with a major Australian operator for heavy duty ultra-harsh environment jackup VALARIS 247. The contract is expected to commence in early to mid-2024 and has an estimated duration of 100 days.
Expro has secured a contract with a major operator for the first deployment of its unique single shear and seal high-debris 15K ball valve assembly.
The multi-functional single shear and seal mechanism will form part of a full subsea deepwater completion/intervention system being designed by Expro for a long-standing and valued customer for a deepwater subsea field at about 6,600 ft in the Gulf of Mexico.
The mechanism is designed to answer the customer’s requirement for a versatile, single-valve subsea solution rather than the conventional double-valve system while offering the reassurance of risk reduction through an additional safety barrier.
Graham Cheyne, Expro’s Vice President of Subsea Well Access, commented, “We are proud to offer our innovative shear and seal solution to meet the needs of this important customer in the Gulf of Mexico. Our cutting-edge technology propels the industry’s momentum towards increased automation, improving safety on the rig floor by minimising personnel and mitigating human error, while providing an additional safety barrier. It offers operators with flexibility for their operations in both in-riser and open water subsea applications.”
Expro’s high-debris single ball system, which delivers shear and post shear seal on a multitude of sizes of coiled tubing, slickline, and electrical cable, is a solution for both gas and liquid. Its versatility makes it suitable for deployment in both in-riser or open water environments.
It is NACE MR0175 compliant and qualified for sour hydrogen sulfide environments. Bi-directional sealing is available even after a pump-through. The mechanism has been qualified to API 17G standard for the performance and design of subsea well intervention equipment. Its ability to handle up to 15% debris is a significant improvement over alternative mechanisms used in this environment today.
Expro’s shear and seal valve is available in the ELSA-HP 15ksi enhanced landing string assembly. It can be configured as a single valve, a single valve with a latch mechanism, or as a conventional subsea test tree arrangement, enabling flexibility. Expro is currently integrating the shear and seal ball system into its ELSA-HD 10ksi equipment and open water offerings.
While the oil and gas industry in Southeast Asia is looking ahead to an impressive array of merger and acquisition deals, the region cannot forget its ever-growing decommissioning and abandonment (D&A) liabilities. Approximately 200 offshore fields in Southeast Asia, comprising more than 1,500 platforms and 7,000 plus wells, are likely to stop producing by 2030.
Sustainable D&A practices now stand more relevant than ever as a recently released IEA report predicts that high prices and security of supply concerns highlighted by the global energy crisis is hastening the shift towards cleaner energy technologies. Circumstances have led analysts from Goldman Sachs to revise its bullish prediction of the Brent crude price hitting US$100 by mid-2023 to finish as low as US$86 this year. Such waning confidence in the future oil price and demand in the face of the growing energy transition especially calls for serious consideration of end-of-life responsibilities by operators.
To navigate the elaborate and often complicated process of D&A, operators must follow clear regulatory regime, which is the only way to understand their liabilities. To establish an effective regulatory framework, it may help Southeast Asia to play catch-up with foolproof guidelines and processes already in place elsewhere, such as the UK or the Gulf of Mexico. Chevron and Shell are currently collaborating with Thai and Bruneian regulators respectively through knowledge transfer and pilot project initiatives.
While Southeast Asia is following international conventions such as the International Maritime Organisation Guidelines (IMO) and the United Nations Convention on the Law of the Sea (UNCLOS), it has also adopted new clauses along with these to make them region-specific. For example, the area of ‘pipelines’ is an addition by the ASEAN Council of Petroleum – otherwise absent in the global frameworks – to allow export pipelines to be left in situ, provided that there is no history of pipeline spanning, or movement of the seabed.
A cheap alternative to the costly affair of decommissioning, the Rigs to Reefs programme has the potential to benefit marine life as well. The rig-to-reef way of D&A can spare companies a significant capital. In the Asia-Pacific region, an average 6,000-ton oil platform will cost approximately US$35mn to completely remove, notes an Asia-focused research website. However, D&A via the rigs-to-reefs approach would cut that amount in half, with an average saving of up to nearly US$22mn per platform decommissioned, according to decommissioning expert Brian G Twomey.
The Bureau of Ocean Energy Management (BOEM) has proposed changes to modernise financial assurance requirements for the offshore oil and gas industry, in order to better protect American taxpayers from incurring the costs associated with the oil and gas industry’s responsibility to decommission offshore wells and infrastructure.
BOEM Director, Liz Klein, commented, “These proposed updates to our financial assurance regulations will help ensure that energy companies that are operating in publicly-owned federal waters are able to fulfill their clean-up and decommissioning responsibilities, without taxpayers having to step in to foot the bill. The commonsense updates that we are proposing would modernise evaluation and financial criteria so that we are better protecting taxpayers from the decommissioning costs associated with aging oil and gas infrastructure on the Outer Continental Shelf.”
Together with reforms to royalty rates, rental rates, onshore bonding requirements, and leasing practices, the changes being announced today continue to advance the Biden-Harris Administration’s federal oil and gas reform agenda, which was outlined in a report that the Department of the Interior developed in response to Executive Order 14008.
The proposed rule would establish two metrics by which BOEM would assess the risk any company poses for the American taxpayer.
To accurately and consistently predict financial distress, BOEM would use credit ratings from a nationally recognized statistical rating organisation, or a proxy credit rating generated through a statistical model. BOEM would require companies without an investment-grade credit rating to provide additional financial assurance. BOEM is seeking public feedback on whether it should rely on credit ratings to make these determinations and what credit rating threshold would best protect taxpayer interests without imposing undue burdens on industry.
Second, BOEM would consider the current value of the proved oil and gas resources on the lease itself when determining the overall financial risk of decommissioning, given that any lease with significant reserves still available would likely be acquired by another operator that would then assume the liabilities in the event of bankruptcy.
The proposed regulatory changes would provide additional clarity and reinforce that current grant holders and lessees bear the cost of ensuring compliance with lease obligations, rather than relying on prior owners to cover those costs.
BOEM would use decommissioning estimates based on industry reported data collected by the Bureau of Safety and Environmental Enforcement (BSEE) at a level that would adequately cover estimated decommissioning costs without being overly burdensome. This proposed rule would allow current lessees and grant holders to request phased-in payments over three years for new financial assurance amounts.
The proposed changes were published in the Federal Register on 29 June, which will open a 60-day public comment period.
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