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Phillips Norway submits cessation plan for North Sea platforms Recommended $1.14 billion proposal includes recycling steel structures, leaving trenched pipelines buried Petroleum News Alaska
Phillips Petroleum Co. said Oct. 22 that a subsidiary, Phillips Petroleum Company Norway, has submitted to Norway’s Ministry of Petroleum and Energy a cessation plan for 15 structures in the Ekofisk area of the Norwegian North Sea.
The plan, submitted on behalf of the Phillips Norway Group, assesses numerous disposal alternatives and discusses safety, environmental and economic impact analyses and recommends that the topsides of all 15 structures and the 14 steel platforms be brought ashore for recycling and that the concrete tank and barrier wall be left in place.
In addition, the group recommends that 149 miles of trenched pipelines remain buried and that drill cuttings be left in place. The estimated cost of the recommended cessation plan is $1.14 billion. Due to the tax structure in Norway, it is anticipated that the Norwegian state will fund more than two-thirds of this cost, with the remainder funded by the Phillips Norway Group.
The ministry will review the plan and its associated assessment documents and formulate its own recommendations, which it will forward to the Storting for a final decision, expected in the second half of 2001. The Phillips Norway Group has proposed that the platforms be removed between 2003 and 2018.
Evaluation of cessation options began in 1994 Phillips and its co-venturers have been working since 1994 to evaluate more than 200 cessation options. This evaluation process considered the importance of a number of factors including safety, environmental impact, cost, jobs, fishing interests, shipping interests and public opinion. The result of this overall assessment is the recommendation submitted today.
The Phillips Norway Group began intensely studying cessation at the same time it developed plans for Ekofisk II, which will enable Phillips to profitably operate the field through 2028 and significantly reduce operating costs through consolidation of facilities. This consolidation means that use of the 15 structures included in this plan will be phased out.
Phillips Norway has a 35.11 percent interest in Ekofisk, and operates the facilities in the Ekofisk area on behalf of other members of the Phillips Norway Group: Fina Exploration Norway SCA, 28.5 percent; Norsk Agip A/S, 12.389 percent; Elf Petroleum Norge A.S., 8.03 percent; Norsk Hydro Produksjon a.s, 6.37 percent; TOTAL Norge A.S, 3.37 percent; Statoil, 0.95 percent; Norway’s direct financial interest, 5 percent; and Saga Petroleum ASA, 0.289 percent.
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