Abstract
Over the next decade, 100 oil and gas platforms, 2,100 North Sea wells, and 7,500 km of pipeline on the UK Continental Shelf are forecast for decommissioning with costs estimated to be £59 billion by 2050. The oil and gas industry aims to reduce these costs by repurposing some of the decommissioned assets for renewable energy generation. This paper presents the findings of a feasibility study undertaken at the National Decommissioning Centre to identify opportunities and risks associated with repurposing an offshore oil and gas platform in the North Sea for green hydrogen production. Various technical scenarios were investigated for the case study platform and their profitability was determined using economic calculations. The results of the study highlight the importance of considering various factors such as transmission systems, platform repurposing costs, and long-term financial implications when evaluating the techno-economic viability of different scenarios for offshore hydrogen production. Despite the initial investment for repurposing being three times the cost of decommissioning, the profitability forecast over a 20-year period using net present value analysis at a discount rate of 5% revealed that one of the scenarios holds potential economic benefits if the produced green hydrogen is sold at a price of £6.08/kg.
| Original language | English |
|---|---|
| Publisher | SSRN |
| Number of pages | 20 |
| DOIs | |
| Publication status | Published - 3 Nov 2023 |
Bibliographical note
The Data for Net Zero (D4NZ) is a cluster of projects driven by the Scottish government’s commitment to achieve net zero emissions by 2045. The Scottish government aims to achieve this through the deployment of new technologies, optimising operations, basin-wide decision making, and reusing assets for renewable energy generation. This paper is a product of one of the workpackages in the D4NZ project that is focused on assessing the suitability of repurposing legacy oil and gas infrastructure to accelerate the progress of hydrogen production and carbon capture, utilisation, and storage (CCUS). The techno-economic study was conducted over a period of sixteen weeks and involved consultation with some stakeholders in the oil and gas industry, as well
as a thorough review of publicly available information and in-house data sources. The authors would like to thank the National Decommissioning Centre (NDC), the Net Zero Technology Centre (NZTC), and Canadian Natural Resources (CNR) for support and access to valuable data for the completion of this study.
