Decommissioning an oil rig costs5 May 2020 12:48
"Decommissioning a platform typically involves its complete removal from the seafloor, then hauling it away for disposal or scrap. It's a pricy proposition. The most recent estimate for removing all platforms off of the California coast totals $8 billion, Scarborough Bull said. Modifying the platforms to serve as permanent reefs cuts these costs significantly, especially those associated with hauling, cleaning and disposing of the support structure on shore, which will have thousands of tons of sea-life clinging to it by the time it reaches retirement.
To convert the lower portion of the platform into a permanent reef, the structure must be free of any hydrocarbons or other hazardous materials described in any federal, state or local law, ordinance, rule, regulation, order, decree or requirement. Yet this is still a far cheaper venture than total removal. And the savings don't merely benefit the oil company, which foots 100 percent of the decommissioning cost. Coastal states that have rigs-to-reefs laws require that the company share with the state a portion of the money it will save if a platform is reefed rather than removed; often 50 percent of the cost savings, explained Scarborough Bull."
Any hydrocarbons that float free whilst a platform is being decommossioned should hopefully be minimal yet by contract would need to be cleaned up. As the world transitions from Oil to environmentally friendlier options , more deep sea rigs which have much higher extraction costs and risks will becoming towards decommission.
Our Setcar deal as Trek and itsyou have pointed out , could actually much bigger than we imagined ?
Interested to hear others views please ?
Sign In
Follow the stocks
