Definition of Field & Well Abandonment
Abandonment of onshore / offshore oil and gas facilities requires the permanent isolation of all hydrocarbon reservoirs and pressure containing zones from each other and the seabed. Associated well casings, platforms, pipelines and production facilities are usually required to be permanently removed.
The plugging and abandoning (P&A) of oil and gas wells that are no longer economically viable for production, or which have wellbore issues that require closure, has historically been conducted as an afterthought in the oil and gas production business.
Production wells that can no longer be used must be plugged to prevent the oil and gas reservoir fluids from migrating up hole over time and possibly contaminating other formations and or fresh water aquifers.
According to Oil & Gas UK (Decommissioning Insight 2014), GBP 470 million was spent on decommissioning in 2013 and has forecasted a total expenditure on decommissioning of GBP 14.6 billion from 2014 to 2023.
The largest category of this expenditure is well plugging and abandonment (P&A). The analysis on how well P&A cost forecast have varied historically using data from the 2011 to 2014 reports.
This is an indication that whenever a well / field abandonment is being deferred, eventually the cost of the abandonment itself will increase substantially.