Economic Report 1999 Index

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The Challenge of Decommissioning The industry recognises that the decommissioning of offshore installations needs to be handled in an environmentally sensitive way. The OSPAR agreement has without doubt increased the cost of removing platforms outside the Southern North Sea and as a result the cost could be substantially more than was previously estimated. The scale of the challenge is illustrated by Figure 21. Figure 21 - Removal Costs by Maturity Source:  Wood Mackenzie Please click on the image below to view the full chart: During the next decade the cost of decommissioning will be shared by the industry and Government through the established system of taxation. However, some costs could be deferred if field life can be extended. Increased production from fields whose life can be extended or the development of new satellite fields would be economically beneficial for both operators and the Treasury.