The Future of North Sea Project Managers
- A Balancing Act of Skills Derek Allan - Shell E&P
What Have I Been Asked to Talk About
An Insight into Decommissioning
The Future of North Sea Project Managers
Collaboration for a Better, More Competitive Future
Decommissioning – A Liability Business
Decommissioning is a LIABILITY Business
For the Operators and UK Government its Bad Business
For Everyone Else – Its Great Business!
Where we need to be – A Great Business to be Part of!!!
Decommissioning – The Size of the Pie
Industry Wide Decommissioning in the UK will include:

470+ installations

10,000km of pipelines

5,000 wells

15 onshore terminals
(Source: Decom North Sea – May 2014)
Associated Expenditure Expected to Reach:

£40bn - £70bn over the next 25 years
(Source: Oil and Gas UK)

£54bn by 2060
(Source: Wood Mackenzie)
Decommissioning – The Size of the Pie
Decommissioning Forecasts in the UK :

140 Fields could cease over the next 5 years

Spend to increase by 50% by 2019

Spend on Decommissioning will overtake spend on
Development projects in 2019
(Source: Wood Mackenzie)
Decommissioning – What’s the Difference
Traditional North Sea Projects:
Decommissioning Projects:
Projects Need to Meet Investment
Criteria/Hurdles
Project are Legally Obliged to Proceed
– 100% Positive
Future Workload Uncertain –
Predominantly Market Driven
Future Market Predictable –
Uncertain Timing
Very Mature Market – Has Evolved
Since the 1960’s
Immature Market, with few projects
Executed thus far
Scope Driven by Technical and
Commercial Drivers
Scope Driven by What’s in place,
Legislation and Execution Model
Asset Integrity Important to Maintain
Production
Asset Integrity Important to Support
Post Production Activities
Decommissioning – Contrasting Drivers
Traditional North Sea Projects:
Decommissioning Projects:
Profitability
Reputation/Legacy
Capital Expenditure
Safety Performance
On-Stream Date
Abandonment Expenditure
Lifetime Expenditure
Stakeholder Relationships
Production
Environmental Considerations
Availability/Reliability
People Issues
Oil Price
New Technology/Expertise
(Safety is a Given)
Decommissioning – Projects Dynamics
Immature
Supplier
Market
Sensitive
Human
Elements
Operational
Phase Before
Project
Stakeholder
Challenges
Complex
Execution
Interfaces
Working
with Late
Uncertainty
Flexibility
Around
Timing
Decommissioning – Fokelore
“ We Don’t Put Our
Best People on it!”
“ It’s Not Very
Interesting!”
“You Can Never
Win!”
“ Low Technical
Content!”
“ The Margins are
Low!”
“ It’s not Very
Exciting!”
“ It’s Just One
Massive
Brownfield Job!”
“ It Can’t be Done
Safely!”
“We’re Wasting a
Lot of Money!”
“ It’s Not that
Sexy!”
Decommissioning – Some Final Thoughts
Decommissioning is a major piece of business on the horizon
and will be with us for the next 25 – 30 years anyway
Decommissioning is coming and it looks like it’s coming
quicker than we would like - are we as an industry ready for
it!!!
And we need to change the image – Decommissioning
‘A Great Business to Be Part of’!!!
The Future for North Sea Project Managers
A Move Towards More Decommissioning projects:

Does That Mean we Need a Different Type of PM

Are the Challenges the Same
A Mix of Projects:

Do We Need to Train/Educate our PM’s
Commercially Aware
‘Commercial Awareness’ could be summed up as:
A Interest in the Business and an Understanding of the Wider
Environment in Which an Organisation Operates
Collaboration For a Better, More Competitive Future
Collaboration From Two Aspects:

Inside the Project

Inside the Industry
Collaboration - Inside the Project
Oil and Gas UK Safety Awards 2012
‘Workforce Engagement’
Brent Delta
Collaboration - Inside the Industry
Dalbrack – Royal Deeside