Decommissioning Agreement Oil And Gas

In the oil and gas sector, the decommissioning process is legally governed by a wide range of international, national and regional legal sources, sometimes opposed to each other and being forged and developed. Today, decommissioning represents an important part of future business opportunities for contractors and consultants in the UK; However, it goes without saying that such an activity involves great responsibilities and therefore a huge cost. B. The international legal framework for the decommissioning process has recently enabled the UK government to strengthen the security of the oil and gas industry by approving the 2016 budget[5] by announcing some innovative measures to attract even more investment. Such measures are, for example, the possibility for new operators to obtain tax relief if they retain commitments to dismantle an asset after their acquisition and the obligation to continue to support the oil and gas administration and the oil and gas industry in order to reduce the total cost of dismantling. On the other hand, it is true that the poor performance of dismantling activities potentially poses a huge risk to the lives of the companies concerned, as well as to the entire oil and gas industry, both in terms of direct and indirect economic losses (in fact, the shares of publicly traded companies can suddenly suffer significant falls and the damage to their reputation can jeopardize current and future orders in their pipelines). With regard to international decommissioning, the main principles of international law (i.e. the principles of decommissioning in the territorial waters of states where it is fully regulated by national law) are the following legal sources: the above debate has acquired an international dimension, since the dismantling mainly concerns offshore installations located on the continental shelf. Such a lack of clarity undermines the predictability that should be guaranteed in order to attract investment and thus take full advantage of the current trend in the dismantling industry. The state of the workspace plays an important role in the installation, with an emphasis on weather conditions. For example, decommissioning in the northern part of the United Kingdom is strongly affected by the isolation and harshness of the environment in which it takes place. This is why moving activities are usually organized in the summer. In addition, the distance is sometimes more complicated than the installation itself, the latter having been the result of a permanent process of overlay over the years.

According to the decommissioning report of the British oil and gas group[3], published in 2013, the cost of covering the commitments to dismantle the British continental shelf between 2013 and 2040 will be about $31.5 million, with $10.4 billion for the total expenditure planned for the period 2013-2022. Approximately 475 production facilities, 10,000 km of pipelines, 15 oil terminals and 5,000 wells are expected to be closed over the next 30 years. Oil and gas companies are expected to return the seabed to its original state (subject to certain exceptions), permanently eliminating facilities and/or infrastructure from the seabed and securing wells.

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