Australian government unveils $60b offshore decommissioning roadmap
The Australian government has revealed plans to create a roadmap to help navigate the forecast upcoming surge in decommissioning of offshore facilities that is expected to cost up to $60 billion over the next 30 to 50 years.
The Federal Minister for Resources and Northern Australia, Madeleine King, told parliament that Australia is well placed to also export its skills and expertise to become a world leader in offshore decommissioning – a looming major global issue.
The minister has told federal parliament that she is now working with the nation’s offshore industries, the offshore workforce, state and territory governments and her ministerial colleagues to develop the roadmap for a future Australian offshore decommissioning industry.
Significant economic opportunity
She said the roadmap will examine how Australia can capture the significant economic opportunity looming in the years and decades ahead, including preparing for future removal of offshore wind farm infrastructure.
The new investigations will also consider the potential for the re-use of materials from the decommissioned offshore platforms, pipelines and other infrastructure in other industries while also investigating other likely recycling opportunities.
“Norway and the United Kingdom see up to 97% of the steel from offshore projects recycled and reused into things like offshore turbines,” the minister told her parliamentary colleagues.
New jobs and skills
The minister said the roadmap is being designed to help identify opportunities to create new, high-paying, high-skill jobs in the regions, while supporting the transition of Australia’s existing offshore workforce.
The May federal budget included $4.5 million to develop the decommissioning roadmap which is targeted for release in 2024.
To support the development of the roadmap, the Australian government has launched an issues paper and will shortly commence public consultations, with the aim of helping to scale up a viable domestic offshore decommissioning industry in this country.
“We can do it here. We should do it here. And we can export our expertise to our region.
has outlined the potential for Australia to build a new industry to decommission offshore oil and gas infrastructure and released an issues paper that points to the opportunities for the sector.”
“Establishing a decommissioning industry in Australia will provide immense economic opportunities and create well-paid jobs in regional communities,” Minister King said.
Offshore sector facing massive headache
With thousands of pieces of infrastructure located in Australia’s primary offshore petroleum producing basins, government and local industry is facing a massive headache with a stream of projects currently winding down.
Australian law requires that the offshore resources industry pays all costs associated with decommissioning offshore oil and gas infrastructure.
Minister King said the government’s objective now is to identify opportunities to maximise the benefits of this industry investment to all Australians.
“The Australian government wants as much of the anticipated $60 billion in spending to remove old oil and gas infrastructure to be spent backing Australian ingenuity and jobs.”
Extraordinary economic opportunity
The minister said that while the offshore resources industry and governments are facing an extraordinary task, it is also an extraordinary economic opportunity for Australia.
“With the right policies and regulatory settings, and by harnessing the expertise of our existing offshore resources workforce, we can capture this economic opportunity and build a vibrant maritime decommissioning economy.”
“We want to build an industry to service not just ageing offshore oil and gas assets in Australia, but also meet future demand for sustainably decommissioning offshore windfarms at the end of their productive life.”
New opportunities for service providers
Local and international service providers are already circling to grab a piece of the $60 billion pie that will require expertise and technology from a wide range of specialists.
Perth-headquartered digital twin solutions specialist RemSense Technologies (ASX: REM) is promoting its unique Virtualplant system as an offering that can provide industry and government with an answer that can not only save money and time, but also make offshore decommissioning activity safer.
Virtualplant utilises virtual reality (VR) and artificial intelligence (AI) technology to create a digital representation of assets, such as an offshore platform. This can be integrated with existing business operations and asset management systems to deliver greater productivity, increased safety and reduced costs.
In particular, RemSense says there is significant value in Virtualplant’s ability to initially facilitate general visual inspection (GVI) operations remotely assessing the asset in its ‘as built’ environment and not ‘as designed’.
This can provide a safer and more cost-effective alternative and potentially significantly reduce the need to send multiple people offshore during risky decommissioning operations.