The North Sea Transition Authority (NSTA) has warned oil and gas operators to urgently decommission hundreds of inactive wells or face spiralling costs, reduced rig availability and potential fines.
The warning follows the publication of the NSTA’s Decommissioning Cost and Performance Update, which highlights a growing backlog of wells overdue for decommissioning.
More than 500 wells have already missed their decommissioning deadlines and over 1,000 more are expected to become due between 2026 and 2030.
The NSTA says failing to act quickly could push decommissioning costs up by more than £4 billion and threaten the viability of the UK’s decommissioning supply chain, as rigs and vessels seek more lucrative opportunities overseas.
“The NSTA is pulling every lever at our disposal to encourage operators to decommission more wells more quickly,” said Pauline Innes, NSTA Director of Supply Chain and Decommissioning.
“We are willing to help operators when that is necessary but, equally, we are prepared to get tough on those who continually frustrate and delay.”
In 2024, operators undertook some form of decommissioning work on 223 wells, with 103 reaching final abandonment.
While this represented over £1 billion in spend, the NSTA says around 300 wells must be fully decommissioned each year to address both the existing backlog and upcoming demand.
Legal obligations require operators to decommission oil and gas infrastructure to protect the marine environment. Delays not only risk environmental harm but also damage the sector’s reputation with investors and the public.
The NSTA is encouraging collaboration through multi-operator well decommissioning campaigns, which have shown efficiency and cost benefits.
It has also consulted on measures to increase performance transparency and recently opened investigations into missed decommissioning deadlines.
The regulator’s estimated total decommissioning cost for the UK Continental Shelf now stands at £41 billion in constant 2021 prices.
NSTA warns oil and gas firms: decommission wells now or face cost hikes and fines appeared first on Energy Live News.