With 7.6% CAGR, Offshore Decommissioning Market Size to Reach USD 8.30 billion by 2028

According to Exactitude Consultancy the Global Offshore Decommissioning Market value is expected to reach USD 8.30 billion by 2028, growing at a CAGR of 7.6% Between Forecast Period 2022 and 2028 |Growing adoption of technologies to increase production from mature fields, Aging offshore infrastructures, especially in North Sea and Gulf of Mexico

/EIN News/ -- Luton, Bedfordshire, United Kingdom, Feb. 23, 2023 (GLOBE NEWSWIRE) -- Exactitude Consultancy, the market research and consulting wing of Ameliorate Digital Consultancy Private Limited has completed and published the final copy of the detailed research report on the Offshore Decommissioning Market.

The global offshore decommissioning market is expected to grow at more than 7.6% CAGR from 2021 to 2028. It is expected to reach above USD 8.30 billion by 2028 from a little above USD 4.8 billion in 2021. Offshore decommissioning refers to the process of dismantling and removing offshore oil and gas installations, including platforms, wells, and associated infrastructure, at the end of their operational life. The offshore decommissioning process is complex and involves multiple steps, including plugging wells, cutting and removing topsides and jackets, and disposing of equipment and materials.

The offshore decommissioning market is driven by various factors, including the increasing number of aging offshore oil and gas installations, stringent government regulations, and the growing focus on environmental sustainability. The market is also influenced by the fluctuating oil and gas prices, which impact the profitability of oil and gas companies and, consequently, their willingness to invest in decommissioning activities.

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What is offshore decommissioning?

Decommissioning is the process of ending offshore oil and gas operations at an offshore platform and returning the ocean and seafloor to its pre-lease condition.

Regional Analysis:

The offshore decommissioning market is segmented into North America, Europe, Asia Pacific, Latin America, and the Middle East and Africa. North America is projected to grow at a steady rate with many offshore oil and gas platforms are under evaluation for dismantlement in the bearish oil market. In Europe, the decommissioning market is driven by several factors such as increasing decommissioning activities in UK, Denmark, Norway, etc.

UK has been the most active market for offshore decommissioning with global market share approximately 50%. Challenging market outlook has put many aging fields to rest as diminishing output proved insufficient to cover production costs. Many fields around the world are under evaluation of dismantlement, which expected to leverage offshore decommissioning market in other parts of the world.

Report Attribute	Details
Offshore Decommissioning Market size value in 2021	USD 4.8 billion
Revenue forecast in 2028	USD 8.30 billion
Market Growth rate	CAGR of 7.6% from 2022 to 2028
Base year for estimation	2022
Historical data	2018 - 2020
Forecast period	2022 - 2028
Quantitative units	Revenue in USD Million, volume in units, CAGR from 2021 to 2028
Report coverage	Revenue forecast, company ranking, competitive landscape, growth factors, trends
Segments covered	By Service Type; Depth; Structure; Removal and By Regional
Regional scope	North America; Europe; Asia Pacific; Latin America; MEA
Country scope	U.S.; Canada; Mexico; Germany; France; Italy; U.K.; China; India; Japan; Brazil; Saudi Arabia
Key companies profiled	Heerema Marine Contractors, Royal Boskalis Westminster N.V., Petrofac, Oceaneering International, Baker Hughes Company, Halliburton, and Schlumberger.
Customization scope	Free report customization with purchase. Addition or alteration to country, regional & segment scope.

Companies Covered in Offshore Decommissioning Market Report:

• Heerema Marine Contractors
• Royal Boskalis Westminster N.V.
• Petrofac
• Oceaneering International
• Baker Hughes Company
• Halliburton
• Schlumberger

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Report Benefits

• Develop business strategies by understanding the trends shaping and driving the Market.
• Drive revenues by understanding the key trends, innovative products and technologies, market segments, and companies likely to impact the Offshore Decommissioning Market in the future.
• Formulate effective sales and marketing strategies by understanding the competitive landscape and by analyzing the company share of Offshore Decommissioning Market leaders.
• Identify emerging players with potentially strong product portfolios and create effective counter-strategies to gain a competitive advantage.
• Track sales in the global and country-specific Market.
• Organize your sales and marketing efforts by identifying the market categories and segments that present maximum opportunities for consolidations, investments and strategic partnerships.

Driver & Restraint

Growing number of abandoned wells and presence of large mature offshore oilfields worldwide

As a well nears the end of its useful life, it must be permanently plugged and abandoned. This involves the placement of multiple cement plugs within the wellbore to isolate the reservoir and any other fluid-bearing formations. The demand for plug & abandonment (P&A) operations is rapidly increasing, especially in mature offshore areas such as the North Sea and the Gulf of Mexico. According to Decommissioning Insight 2019 by Oil & Gas UK, a total of 2,624 wells are expected to be decommissioned in the North Sea during 2019-2028. This trend is driving the market for offshore decommissioning services, with governments also placing increased focus on well plug & abandonment activities. For example, a bill was introduced in the US House of Representatives in April 2021 authorizing $8 billion for the plugging and clean-up of abandoned oil wells nationwide, aiming to create jobs for oil and gas workers while reducing climate-warming emissions. Hence, the growing demand for well plugging & abandonment is fueling the offshore decommissioning market.

High cost associated with offshore decommissioning processes

Although platforms may share similar characteristics and configurations, the cost of decommissioning can vary significantly based on location, climate, and regulatory requirements. The decommissioning process is complex and requires skilled operators and specialized equipment. While oilfields generate revenue during the hydrocarbon production phase, they become a liability during decommissioning operations. Decommissioning oil and gas installations can be costly, with estimates varying worldwide. For example, removing a complete platform in shallow waters like the Gulf of Mexico may cost between USD 15 million and USD 20 million, while the cost of removing structures from deep water, such as in the North Sea, can range from £30 million for smaller platforms to £200 million for larger ones, according to Oil and Gas UK.

Industry Developments

• In May 2021, Heerema Marine Contractors and AF Offshore Decom have commenced one of the largest topside removal projects of its kind in the North Sea on behalf of TAQA. The Brae Bravo removal campaign is the first major asset removal project for TAQA, and as a late-life asset operator in the UK, safety and environmental impact principles are at the center of the project for TAQA and its partners
• In March 2021, Aker Solutions has signed an agreement with Heerema Marine Contractors for decommissioning to the Heimdal and Veslefrikk fields, offshore Norway. The scope includes the reception, dismantling, and recycling of three offshore installations from the Heimdal and Veslefrikk fields.
• In February 2021, Saipem was awarded a contract by Qatargas a contract for the offshore development of the North Field Production sustainability project. The scope includes the engineering, procurement, construction, and installation of various offshore facilities.
• In January 2021, Boskalis acquired all the shares of the subsea services business of Rever Offshores. Through this acquisition, Boskalis strengthens its current position in the subsea services market in Northwest Europe, Africa, and the Middle East. It has capabilities to serve both the traditional oil & gas market and the rapidly expanding offshore wind market.
• In June 2021, Baker Hughes opened a multimodal facility (MMF) for oil and gas in Luanda, Angola. The facility delivers a suite of products and services across the oil and gas value chain. It will serve as a hub to support customers and projects in Angola and Southern Africa and will also serve customers globally.

Key Market Segments: Offshore Decommissioning Market

By Service Type

• Well Plugging & Abandonment
• Platform Removal
• Conductor Removal

By Depth

• Shallow Water
• Deep Water

By Structure

• Topside
• Substructure

By Removal

• Leave in Place
• Partial
• Complete

By Region

• North America

• Europe
• Asia Pacific
• South America
• Middle East and Africa

Frequently Asked Questions About This Report

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• What is the Offshore Decommissioning Market growth?
• Which segment accounted for the largest Offshore Decommissioning Market share?
• Who are the key players in the Offshore Decommissioning Market?
• What are the factors driving the Offshore Decommissioning Market?

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