New funding for North Sea decommissioning

An additional £4m has been made available through the Decommissioning Challenge Fund to maximise the economic benefit to Scotland from decommissioning oil and gas infrastructure.

Launching the new round of funding, Energy Minister Paul Wheelhouse said decommissioning North Sea infrastructure would help the Scottish supply chain benefit from projects and capitalise global market opportunities by exporting knowledge and experience.

He said: “This fund will support innovation in the supply chain, further cost reduction and improve the recognised skills of the Scottish workforce, which is why it has proved so popular with businesses.”

Established in 2017, the Scottish Government’s Decommissioning Challenge Fund has so far distributed £10.3m to 28 projects.

Open to expressions of interest from 15 July to 2 September, the latest round of funding will deliver capital and resource funding for projects in the 2019-20 financial year.

Mike Tholen, upstream policy director at Oil and Gas UK, said: “Although decommissioning only accounts for eight percent of total spend in the North Sea, it is a growing market in which the UK has first mover advantage.

“This will not only provide the supply chain with a steady workflow in the UK, but these competitive capabilities are exportable to a global market.”

Wheelhouse added: "Industry reports tell us that £15.3bn is forecast to be spent in the UKCS between 2018-2027, with further market demand beyond this. This represents a great opportunity for Scotland’s supply chain and I am delighted to announce this £4m fund.

“Scotland’s energy strategy highlights the significant economic opportunities that decommissioning offers, and commits to enhancing our skills and capacity. As the industry continues to build on established capabilities and internationally recognised expertise, such as in well plugging and abandonment techniques, the fund plays a crucial role in supporting the future development of this growing industry.”