Case Study

Transforming Australia's approach to decommissioning

Live coral reef and fish swimming underwater in the Great Barrier Reef

$50 billion. That’s the cost we’ve reported to fully remove and decommission Australia’s offshore oil and gas infrastructure. And 50 per cent of this activity must be started in the next 10 years.

$17.5 billion. That’s the potential 35 per cent cost savings we identified based on alternative retirement options, emerging technologies and decommissioning efficiency.

Decommissioning and a net zero future

National Energy Resources Australia (NERA) commissioned us to deliver the first operator-supported assessment of Australia’s offshore decommissioning liability. But how do you decommission aging assets in a way that supports local communities and ties into a net zero future?

By using industry lessons from other oil and gas regions. From these, we’ve seen that a comprehensive strategy is an important starting point when planning decommissioning work. Early planning can also maximize cost savings and promote a circular economy approach when dismantling and removing assets.

From challenge to early planning for success

We began by creating a database and decommissioning roadmap for NERA.

We put together an approach to track every piece of offshore equipment in the country and convert this information into a nationwide liability database.

This involved creating a methodology to capture key data around the offshore assets’ characteristics and costing the decommissioning requirements. And as an industry first, we collaborated with seven operators to collect the data.

The database can be used for new developments to explore opportunities for future recycling or re-use and alignment with regional service companies from the earliest design stage. This provides a basis to promote a circular economy approach to decommissioning.

This work represents a transformational moment in Australia’s decommissioning journey, which is underpinned by the expert insights delivered by Advisian.

Andrew Taylor, General Manager Decommissioning, NERA

Roadmap to a sustainable future

NERA used our data to create and launch the Centre for Decommissioning Australia (CODA). CODA will play a critical role in driving decommissioning cost reductions and promoting a collaborative effort between industry, government and local service companies.

Our work means the industry can start looking  for sustainable opportunities, such as growing the local supply chain to recycle materials or using asset re-purposing to support emerging energy technologies. 

This piece of work highlights the vulnerability of the Australian Offshore market to the global decommissioning capability. It presents opportunities for Australia to reduce the costs to the taxpayer by developing Australian capability. We look forward to working with CODA to deliver positive retirement results for aging assets.

Helen Riordan, Global Service Line Lead – Upstream, Midstream Consulting