BANDAR SERI BEGAWAN — Over 1,000 ageing oil wells and platforms are expected to be dismantled in the next 20 to 30 years, the permanent secretary of energy said on Monday.
Business opportunities abound for companies that offer decommissioning services as more than 200 offshore structures and about 1,500 km of pipelines will come to the end of their working lives, said Hj Azhar Hj Yahya.
The cost of removing and recycling oil platforms is expected to reach billions of dollars in the next three decades, he said.
The permanent secretary was speaking at the Decommissioning & Restoration (D&R) Forum, organised as part of the energy-themed week of the Brunei Mid-Year Conference and Exhibition 2021.
Jointly organised by the Ministry of Energy and Petroleum Authority of Brunei Darussalam, the forum aims to raise awareness on potential spinoffs arising from decommissioning and restoration activities in the oil and gas sector.
Noting that Brunei’s oil and gas industry has been operating for over 90 years, Hj Azhar said a growing number of oil and gas platforms will be closed as they “no longer have enough economically recoverable oil and gas reserves to develop and produce”.
He said decommissioning is part of the life cycle of every oil and gas structure, and needs to be carried out safely and responsibly.
This includes restoring the surroundings of onshore and offshore platforms and facilities in line with the regulations, while taking into account the country’s environmental standards.
Hj Azhar, who is also the managing director of Petroleum Authority of Brunei Darussalam, said D&R is still an emerging industry globally with plenty of business opportunities for the supply chain industry.
D&R will be one of the major activities for Brunei’s oil and gas sector in the not too distant future, he said.
One potential spinoff of decommissioning activities is repurposing scrap materials such as carbon steel.
“As the collection of scrap material services is readily available in Brunei, we have a good opportunity to explore this further beyond collecting, and integrate a circular economy approach by venturing into recycling, repurposing or reusing the waste materials,” he added.
Apart from generating revenue, recycling scrap materials will reduce the amount of industrial waste that goes to landfills.
However, he said there is still a lack of D&R forecasting data and experience.
High cost is also one of the issues facing the D&R industry, along with funding, waste management, legislation and environmental considerations.
The permanent secretary said costs can be reduced through lessons learned from previous D&R experiences and new technologies.
The Exploration and Production D&R Guidelines issued by the Petroleum Authority of Brunei Darussalam will serve as the guide to implementation of D&R activities in Brunei.
In 2017, the Ministry of Energy introduced the National E&P Guidelines for Decommissioning and Restoration of Upstream Industry.
The guidelines require all operators to take into account safety risks and environmental impact in managing their late-life onshore and offshore operations.
The Petroleum Authority of Brunei Darussalam will also introduce new D&R legislation for the downstream petroleum industry in the near future, Hj Azhar said.
Turning oil rigs into artificial reefs
Hj Azhar said another area that complements D&R activities is to transform ageing oil rigs into artificial reefs through the Rigs-to-Reefs scheme.
“Brunei has a Rigs-to-Reefs policy since 1988, where 13 offshore structures have been used as artificial reefs and now become a lively marine habitat,” he said.
The permanent secretary said studies have found that fish have been attracted to the artificial reef, which functions as a feeding and shelter area.
“A clear spinoff from the Rigs-to-Reefs policy is ecotourism such as recreational diving,” Hj Azhar said, adding that research can be done with education institutions to explore its potential.
He further said that D&R activities can help reverse the impact of environmental degradation due to offshore and onshore activities.
“With the degradation of natural reefs and its ecosystem as a result of [rising] ocean and sea temperatures and acidity through climate change, artificial reefs play an important role to “re-wild” the sea and make the marine ecosystem lively again,” he continued.