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Friday, 15 December, 2000, 02:57 GMT
North Sea companies face huge bill
Oil rig
Disposal costs for oil and gas installations could top 11bn
North Sea oil companies must confront a huge bill to decommission oil and gas installations, according to a report.

The study by economic analysts Wood Mackenzie said the disposal bill would cost more than 11bn.

It said nearly 300 installations would have to be decommissioned by 2021.

This would reach a peak in 10 years time when 12 North Sea oil fields come to the end of their productive capacity - including the famous Brent, Ninian, Dunlin and Heather fields.

Oil rig
Disposal could spark environmental protests
The report said the bulk of the 11bn decommissioning bill would need to be met in the next 20 years.

It predicted that half of this sum looked set to be borne by just three companies - Exxon Mobil, BP Amoco and Shell.

Wood Mackenzie said the companies could offset a proportion of the disposal costs by recycling some materials.

The huge decommissioning costs predicted may put the oil industry on another collision course with environmental groups.

Brent Spar

In 1991, Shell decommissioned the oil platform Brent Spar and announced it would sink the structure in the North Sea.

This sparked controversy and Greenpeace activists boarded the platform before Shell could complete the disposal.

After three months of mounting protests, and despite the support of the British government, Shell agreed to recycle the platform at greater cost.

In 1996, the 135m-high, 16,000-tonne Brent Spar was chopped up for scrap with some of it being used to build the foundations of a new ferry terminal.

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