Offshore oil and gas decommissioning and resource recovery
We have investigated the challenges, regional opportunities and social acceptability for the multi-billion-dollar decommissioning of obsolete offshore oil and gas infrastructure in Australia.
The challenge
There is a global shift towards a circular economy that will require a major transformation of Australia’s domestic waste and resource recovery sector, including offshore oil and gas decommissioning activities.
Much of Australia’s offshore oil and gas infrastructure will require decommissioning within 30 years, with an estimated cost of A$60 billion. Most of the decommissioning and resource recovery is likely to occur onshore, close to the infrastructure. This will require access to workforces and materials, which may be limited in some regions. These constraints may challenge the development of a safe, cost-effective and environmentally responsible Australian industry.
Our response
In 2023, the Australian Government committed $4.5 million to develop a roadmap for establishing a decommissioning industry. As part of developing the roadmap, we were engaged by the Australian Government Department of Industry, Science and Resources to identify the challenges, regional opportunities and social acceptability of the development of domestic offshore oil and gas decommissioning and resource recovery capacity.
Australia’s offshore oil and gas decommissioning and resource recovery value chain is unique and complex, and limited information exists to support industry development. To gain expert insights into the industry, and to explore the challenges and opportunities for Australia’s decommissioning industry, we conducted in-depth stakeholder engagement.
We conducted a comprehensive literature review, which examined international best practices, international and domestic policies, international case studies, industry reports and scientific literature.
We also engaged with industry experts, including industry and business peak bodies, state and federal government teams and task forces, non-governmental organisation representatives and oil and gas decommissioning researchers. Interviews and engagement with these stakeholders elicited information and expert insights that validated research findings. The information garnered through the desktop review and stakeholder engagement was grounded with international learnings that may be applied to Australia’s decommissioning industry as it develops.
Our research is presented in two technical reports:
- Exploring regional opportunities for onshore resource recovery from offshore oil and gas infrastructure (Boxall et al., 2024).
- Exploring regional opportunities for onshore resource recovery from offshore oil and gas assets, social acceptability (Walton et al., 2024).
The research helps build the evidence to support government decision-making to realise the economic potential of creating connected regional resource recovery supply chains for decommissioning materials.
Our research compliments and supports recent research by other organisations and agencies, such as the Centre of Decommissioning Australia, and contributes knowledge on Australia’s decommissioning and resource recovery activities, challenges and opportunities.
Impact
The development of Australia’s offshore decommissioning industry provides opportunities for regional Australia. These opportunities can be enabled through an adaptive, science‐driven, and co-designed regulatory environment that minimises risks and benefits workers, the environment and communities.
Australia has innovative technology, high-quality research and development, established export pathways, infrastructure and assets, and a highly skilled and transferable workforce, but coordination is required. Benchmarked with international best practice and evidence, the reports identify pathways for adaptative governance, collaboration and partnership, technical innovation and social acceptability to enable efficient and sustainable development off the offshore decommissioning and resource recovery industry in Australia.
Five key enablers are proposed to support the sustainable development of the offshore oil and gas decommissioning industry (Figure 1). The enablers are based on circular economy principles, international best practice, industry reports, experience, and insights from research participants.
Figure 1 Key enablers for the development of sustainable and efficient offshore oil & gas decommissioning and resource recovery to deliver benefits to regional Australia.
The government released Australia’s Offshore Resources Decommissioning Roadmap in 2024 to support the development of a domestic decommissioning industry. The roadmap sets out a path for development, including ways to maximise the amount of decommissioning activity that happens domestically, grow Australia’s industrial capability and materials management, and create safe and high-quality jobs in decommissioning.