Decommissioning of offshore units in Brazil has been increasingly gaining importance within the country’s offshore industry over the past few years.

Although the offshore sector is expanding, decommissioning work is getting attention because many sedimentary basins have reached their peak. Currently, there are 160 units under E&P activities and half of them are more than 25 years old.

The Campos Basin, the most important oil area in the country, for example, reached its oil production peak in 2009. Having unique characteristics along its vast coast and working to increase its output, Brazil now sees itself face to face with the challenge of dealing with is aging projects. Brazil’s oil and gas regulator, ANP, expects the abandonment of 60 oil platforms and 165 offshore wells over the next years. Petrobras has scheduled to decommission four units located in the Campos Basin. They are the P-7, P-12, P-15 and P-33 units.

Challenges are both technical and financial.

Most of the country’s offshore projects deploy wet wells completions and have a large network of pipelines interconnecting wells and oil platforms.

As for the financial perspective, decommissioning mainly impacts the Brazilian state-owned oil company Petrobras. The oil major operates 74 out of the 79 units with more than 25 years in the country’s offshore fields.

The decommissioning of production systems might create a number of opportunities for supply companies in the offshore industry. In fact, companies such as Aker, ABB, Schlumberger, Siemens and TechnipFMC have been carrying out talks with Petrobras to take advantage of those opportunities ahead.

Decommissioning in Brazil is challenging. Offshore activities in Brazil employ larger and more complex subsea systems compared to some other areas in the world. In addition, oil fields in deep and ultradeep water use many pipelines, spanning hundreds of kilometers. Complete removal of any subsea system in cases of high-complexity fields can result in extremely high costs.

“Therefore, it is very important to reduce regulatory uncertainties related to the decommissioning process in order to achieve success in the selling of upstream assets. In that sense, decommissioning gains strategic importance for the Brazilian oil major,” Edmar de Almeida, an economist at the Federal University of Rio de Janeiro, said during a recent conference at the Brazilian Institute of Petroleum. Opportunities For Oil Supply Companies

To meet the challenges of decommissioning, last year Petrobras created a special department for the company’s decommissioning activities, headed by Eduardo Zacaron. During a Nov. 10 event with companies with expertise in production unit decommissioning and ship dismantling, Zacaron said methodologies for comparative assessment of alternatives must be adapted to the Brazilian scenario and must consider all factors and stakeholders.

“Decommissioning has become our focus in the company’s strategic plan. Our main concern is to reduce the likely risks in the end of field life. Petrobras has developed a well completion system, which represents the higher cost involving the decommission process. And this is where the opportunities are found as we need to find solutions for cost cuts, and we need companies that can help us on this strategy,” he said.

Zacaron explained that wells, platforms and subsea systems decommissioning projects have different chronologies and require different solutions.

“Paradigms must be broken with risk analysis. The projects require long-term planning and execution and should be evaluated as early as possible in order to seek synergy and cost reduction. High decommissioning costs can make new projects unfeasible and anticipate the devolution of mature fields,” Zacaron said.

Yet the most challenging decommissioning activities are those related to the subsea systems, according to the manager. “We are talking about thousands of flexible and rigid pipelines and hundreds of subsea equipment that we don’t know what to do with. Definitely, the decommissioning of subsea systems presents the most uncertainties,” Zacaron said.

Environmental Impact

Establishing criteria for decommissioning is also a challenging task. Committing to environmental sustainability is among them. Bruno Graffino, director for Brazil’s environmental regulator IBAMA, emphasized that importance of evaluating environmental impacts as well as designing the decommissioning cycle. “These impacts must be compared to the economic and social aspects in order to contrast environmental impacts to the financial and social costs,” Graffino said at the same event.

Graffino said conversations between Brazilian government and companies are also important for creating a better regulatory framework.

Earlier this month, ANP announced that it is planning to begin drafting a resolution that will regulate the decommissioning of oil and gas production systems. The new regulatory framework, which will revise existing rules, aims to establish deadlines and obligations to be carried out by the concessionaires in the process of decommissioning.

—Brunno Braga