Field decommissioning liability established at the earliest stage
InterAct and its Nigerian partner, PetroFlow Integrated Consultants, have completed a study of the issues surrounding the decommissioning of the Ebok oilfield, which is in 40m of water in Block OML 67 approximately 50km off the Nigerian coast. The study aimed to provide an initial estimate of the cost of this important end-of-life exercise.
The Ebok field partners, Afren and Oriental Energy Resources, commissioned the study unusually early in the field’s development. At the time, the project was only just moving into the construction phase.
There were several advantages to conducting a decommissioning study at this point. The results have begun to establish the field partners’ future financial liability for decommissioning the field. Further, some thought has been given to how the cost of the exercise could ultimately be minimised. Aside from these aspects, legislation is coming into force in Nigeria that will make early decommissioning studies imperative.
The Petroleum Industry Bill is making its way through the Nigerian parliament, and one of its sections calls for agreement between the authorities and field licence holders “at the commencement of production” on the measures to be taken at the end of a field’s life. Significantly, it also requires licence holders to “set up and manage a fund for the decommissioning, abandonment and disposal” of fields and their facilities.
The InterAct–PetroFlow study looked at decommissioning and removing the infrastructure, much of which still has to be installed; however, the detailed Ebok field development plan gave the study team a good indication of what will ultimately be involved.
The plan is for a wellhead platform with a mobile offshore production unit (MOPU) alongside that links to a floating storage and offloading (FSO) vessel. Phase II of the development will add another wellhead platform. The understanding at this stage was that the two wellhead platforms will eventually support 15 wells.
The study used the premise that decommissioning will be a single continuous campaign. The team also assumed the complete removal of all structures and debris, and the retrieval or burial of all infield pipelines to leave a clear seabed.
Before selecting a preferred option for more detailed analysis, the team considered various ways of performing the work. They examined questions surrounding permitting, approvals, planning, project management and mobilisation, and outlined procedures for the entire decommissioning and abandonment of the field. Following this, the team put together as accurate an estimate as possible of the cost, at today’s rates, of the overall exercise.
The study has provided the field partners with financial information that will be an important factor in the overall economics of the field. It has also placed them in a strong position as the authorities push decommissioning liability higher up the industry agenda.
Main activities covered by the study
- Plugging and abandoning all the wells
- Removing the wellhead platforms and dismantling and disposing of them onshore
- Decommissioning the processing equipment aboard the MOPU, disconnecting all the transfer lines and umbilicals, and lowering the MOPU and towing it to a suitable port
- Decommissioning the processing equipment aboard the FSO, disconnecting all the transfer lines and umbilicals, lifting and recovering the 12 mooring lines, and towing the FSO to a suitable port
- Decommissioning all infield pipelines and burying or recovering them
- Clearing the seabed, undertaking a final site survey andsupplying the project report