OTC 2016: DNV GL’s new RP could cut well P&A costs by up to 50 pct

DNV GL, a certification body and classification society, has issued a new Recommended Practice (RP) on risk-based abandonment of offshore wells which could, according to the organization, potentially reduce P&A costs by 30–50%.

DNV GL issued a technical paper and presentation on the RP at the Offshore Technology Conference (OTC) in Houston on Monday, May 2. The company claims that the globally applicable Recommended Practice (RP) on risk-based abandonment of offshore wells in combination with optimized project execution and new technology could reduce plugging and abandonment (P&A) costs by as much as 30-50%.

DNV GL said that the presented framework in the RP enables an individualized approach with fit-for-purpose well abandonment designs which is a contrast to the prescriptive methodology available in the industry today.

Well abandonment is economically driven when oil or gas reservoir production stops being profitable. Authorities require that all operators undertake these operations in an environmentally friendly way by establishing a permanent barrier to prevent release of hydrocarbons to the surface. Traditional P&A methods are time consuming, costly and remain unchanged despite technological advances, the organization stated.

Per Jahre-Nilsen, business development leader of DNV GL – Oil & Gas said: “The costs related to well P&A are enormous. Using current practices, there will be a global fleet of dozens of full-time drilling rigs needed to perform P&A for generations to come. We believe the time has come to tackle this issue head on by assisting regulators and the industry to establish a new methodology for dealing with the decommissioning of wells. By using this method, hazardous wells will get the attention they deserve, and benign wells will avoid excessive rig-time and expenditure. We’re looking at potential cost savings of more than USD32bn on the NCS alone, and even more globally.”

The DNVGL-RP-E103 ‘Risk based abandonment of offshore wells’ is based on case studies performed by DNV GL in projects dating back to 2011. A process which assesses well barrier failure modes, well flow potential, valued ecosystem and safety components, dispersion modeling and conducts an impact analysis.

Elisabeth Tørstad, CEO of DNV GL – Oil & Gas, said: “DNV GL helps the industry to understand and manage the risks of their operations. Risk-based approaches are widely used in all other offshore disciplines, ensuring appropriate long-term environmental protection and also representing the most efficient method to ensure safety. It is time to apply these principles to P&A.”

DNV GL claims that the largest obstruction to change so far has been the prescriptive approach to current regulations. According to DNV GL, the RP development was done in association with industry players, international oil and gas operators and regulators.