Australia’s decommissioning landscape is rapidly evolving as projects that have been under planning for the past couple of years are tendered and awarded. This transition to execution is creating numerous opportunities across the supply chain and highlighting the industry’s growth requirements for the future.

Most of the current decommissioning activity is off the coast of Western Australia.

Woodside announced several projects in late May with the awarding of all major contracts for the decommissioning of subsea infrastructure at the Enfield, Griffin, Stybarrow and Echo Yodel fields.

This will include the removal of the Nganhurra riser turret mooring (RTM) on the Enfield field, the Griffin RTM and the Stybarrow disconnectable turret mooring.

Contractors engaged to undertake activities during these works include TechnipFMC, Heerema, McDermott, Fugro, DOF and McMahon. Transocean was also awarded an additional contract for permanently plugging and abandoning wells in the Stybarrow field.

Santos is also progressing planning for the decommissioning of the Mutineer Exeter Fletcher Finucaine field, intending to execute works during 2024 to remove much of the infrastructure associated with these assets.

Elsewhere offshore Australia, Esso is making significant progress off the coast of Victoria with planning for the removal of facilities from the Gippsland basin and has had significant well plug and abandonment activity ongoing for a couple of years.

Meanwhile, off the coast of the Northern Territory the Federal Government has recently called for tenders for phases two and three of the decommissioning of the Northern Endeavour facility they assumed responsibility for.

These works will be carried out over the next few years following the removal of the floating production storage and offloading (FPSO) vessel, which is anticipated for early 2024.

This expansion in activity is then underpinning the growth of domestic capacity and capability with the real and demonstrated pipeline of work supporting business confidence to invest in facilities, technologies, and skills across the value chain.

Several international companies are either in the process of establishing a presence in Australia or contemplating their strategies. Meanwhile, established businesses are expanding their services and locations to better meet the rising demand.

The Australian decommissioning industry will need to scale rapidly across the nation to manage both the awarded and planned scopes described above along with additional works in the pipeline, including the very significant activities Chevron is planning for on Barrow Island as the former Western Oil wells cease production in 2025.

To scale to meet this demand the sector will need to establish and mature facilities to receive the materials, grow the experience, capability and capacity of the workforce and ensure that its disposal and recycling pathways are robust and capable of handling the volumes of materials.

In support of this growth CODA has expanded on its initial reports, which assessed the decommissioning market’s size, global best practices for planning and execution, a technology roadmap, and understanding the opportunities for local disposal and recycling pathways.

CODA is also currently concluding a WA dismantling hub study, as well as a national skills review for the Australian oil and gas decommissioning industry.

The WA hub study has found that while there are several facilities capable of receiving the materials anticipated to be removed, the overall infrastructure still needs to be put in place to execute the full scope of these works including all the cleaning and recycling of received materials.

The skills review, which will lead to the development of a broader skills strategy, is showing that while many of the required skills and capabilities can be found in the Australian market, many are in very short supply and the depth of experience remains very low.

This limited and shallow skills pool will exert pressure on numerous local businesses, as they strive to execute projects amidst global demand for these skills. Additionally, local demand for maritime skills is on the rise with the growth of the offshore wind sector.

Attracting and developing the required skills will need a concerted effort from both the domestic and international companies involved in the Australian decommissioning market.

In coming months CODA will also be developing a new online decommissioning outlook tool that aims to show the timing and high-level works for new projects. This tool is intended to help the service sector plan for upcoming volumes of work as well as provide a broad overview of the scale of works required.

CODA will also take the findings of the hub study along with information from other states and territories to support the development of capacity and integrated supply chains across the country, ready to deal with the mix of materials associated with decommissioning.

Recognising the need to support growth of the industry, in the May budget, the Australian Federal Government announced plans to develop an offshore decommissioning roadmap. This work is intended to put in place a national strategy to support the growth of the industry and has kicked off an extensive consultation process to gather input and ideas from across the industry.

Access to vessels for conducting various offshore activities will remain a challenge for the Australian market. This difficulty arises from several factors, including the considerable distance from vessel home bases, the relatively modest project scopes, and the industry’s fragmented nature.

The situation is further exacerbated by rising demand for these vessels from both new oil and gas projects and the global expansion of offshore wind installations.

Balancing vessel availability and the capacity of accommodating facilities for various removal projects, will make planning for any project particularly challenging.

In conclusion, Australia’s decommissioning industry is evolving rapidly, presenting numerous opportunities for growth across the supply chain.

With major projects underway and a promising pipeline of future work, the sector is attracting both domestic and international interest.

However, it’s important to acknowledge the challenges ahead, such as the need for skilled labour and vessel access.

As the industry continues to expand, a concerted effort from stakeholders will be required to address these challenges and ensure its long-term success.

The Australian decommissioning landscape is poised for growth, and with strategic planning and collaboration, it can seize the opportunities that lie ahead.