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New tech could cut millions from decommissioning bill
15 Jun 2018

A new decommissioning technology which could cut hundreds of millions of pounds from the decommissioning bill for both the taxpayer and the oil and gas industry has been successfully tested by Spirit Energy

The new technique to plug and abandon oil and gas wells, developed by Interwell, has been tested for the first time in Europe by Spirit Energy in Caythorpe, Yorkshire, on an onshore gas well.

The trial of the new approach to decommissioning – which uses thermite and a controlled chemical reaction in the well rather than the traditional cement plug – was co-funded by Spirit Energy and the Oil & Gas Technology Centre (OGTC) and is the next step towards offshore trials of the technology.

The thermite reaction has been used for centuries in welding railway tracks together, and should it now be used widely offshore it could significantly cut the cost of plugging and abandoning wells – one of the most expensive phases of decommissioning for both operators and HM Treasury, as decommissioning operations in the UK are subject to tax relief.

Oil & Gas UK estimates suggest nearly £17billion will be spent on decommissioning on the UK Continental Shelf (UKCS) between now and 2025 – with the well plugging and abandonment phase typically accounting for nearly half the cost of decommissioning projects.

The Caythorpe trial follows similar tests in Canada, and Spirit Energy is now continuing to work closely with Interwell, other operators and regulators to gain acceptance for the technology as a permanent barrier and identify further decommissioning projects which could benefit from the technology.

Minimising environmental impact

Neil McCulloch, Technical & HSE Director at Spirit Energy, said: “As the UK’s decommissioning industry gathers pace, any technology which allows us to maintain our commitment to minimising environmental impact and is cost effective for both the industry and the taxpayer has to be welcomed.

“We were delighted to lead on this trial with Interwell and the OGTC, and look forward to continue working with both them and the wider industry as this technology moves towards offshore trials.”

Malcolm Banks, Wells Solution Centre Manager for the Oil & Gas Technology Centre, said: “We are delighted with the results from the onshore trial. Interwell’s thermite technology has been around for a number of years and it’s great to see Spirit Energy step up and deploy it in the UKCS. Next step is to take it offshore and we’re confident that we’ll see the same positive results.

“The technology could save the UK oil and gas industry more than £100 million per year but that’s only possible if we continue to work together with the project partners and the regulator to gain acceptance for it as a permanent barrier.”