£19bn to dismantle aged North Sea oil platforms

There are about 260 platforms that need to be decommissioned

The cost of dismantling North Sea oil and gas platforms is forecast to reach £19bn over the next 30 years.

A new report by industry specialists said there were about 260 platforms to be decommissioned.

Consultants Deloittes and Douglas-Westwood said the work presented "big opportunities" for those in the industry.

They estimate the value of contracts to process the aged structures could be worth $1bn (£630m) a year.

The projected workload is expected to exceed the capacities of the existing heavy lift vessel fleet and onshore deconstruction facilities.

That could present opportunities for future recycling yards and oil well service companies.

The report also highlighted that the majority of decommissioning activity and related spend would occur between 2017 and 2027.

'Significant challenge'

Oliver Sanderson, analyst and lead author of the study, said: "Delivery of new vessels is urgent and four more onshore yards may be needed in order to meet increased onshore demand.

"Our research clearly demonstrates that decommissioning activity in the UKCS (UK continental shelf) region is happening right now and that it will ramp up even further over the next decade.

"On average, this represents a $1bn (£630m) per year prize over the next 30 years.

"The anticipated level of decommissioning will provide a major business opportunity for the oil services industry - especially vessel operators and well service companies and could be a significant boost to regional economies."

Andy Ogram, partner in the energy practice at Deloitte in Aberdeen, added: "Decommissioning itself is not a new phenomenon.

"Some projects have already been completed in the UK and in other regions such as the Gulf of Mexico, however, the challenges posed by the North Sea structures because of their scale and the local climate, represents a significant challenge."