The offshore decommissioning market involves the removal of offshore oil and gas infrastructure such as platforms, pipelines, and other infrastructure at the end of their productive lives. This includes cleaning, disassembling and removing offshore oil and gas platforms and associated infrastructure and transporting the waste material to shores for disposal. Offshore decommissioning helps clear the seabed of disused offshore infrastructure and restores the marine habitat. It allows oil and gas operators to fulfill their asset retirement obligations and environmental regulations. The rising number of ageing offshore oil and gas platforms and pipelines mainly in the Gulf of Mexico and the North Sea regions has become a major driver for the offshore decommissioning market.
The global Offshore Decommissioning Market is estimated to be valued at US$ 7.07 Bn in 2023 and is expected to exhibit a CAGR of 5.8% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
One of the key trends in the offshore decommissioning market is the increased complexity of decommissioning projects. As offshore oil and gas infrastructure ages and reaches the end of operable lives, they become more corroded and difficult to dismantle safely. Issues such as instability of drilling platforms, safety hazards from remaining oil and gas in pipelines, environmental effects of contaminants require specialized skills and new technologies. This has driven innovation and development of new service offerings by decommissioning contractors. Specialized vessels, remote technologies, robotic solutions and advanced engineering designs are helping contractors tackle increasingly complex decommissioning projects. New regulations around reusing and recycling infrastructure have also emerged, pushing for more sustainable decommissioning practices.
Porter’s Analysis
Threat of new entrants: The offshore decommissioning market requires heavy investments, certification and permits from regulatory bodies, thereby limiting threat of new entrants.
Bargaining power of buyers: Large oil & gas companies have some bargaining power being major buyers in the market. However, growing decommissioning volumes ensure steady demand.
Bargaining power of suppliers: Major suppliers like service providers and equipment manufacturers have moderate bargaining power due to few integrated companies operating in the market.
Threat of new substitutes: There are no close substitutes for offshore decommissioning services.
Competitive rivalry: The market comprises large integrated operators and regional service providers. Competition is high based on service differentiation and project expertise.
Key Takeaways
The Global Offshore Decommissioning Market Size is expected to witness high growth over the forecast period supported by growing decommissioning volumes across aging oil & gas infrastructure. The global Offshore Decommissioning Market is estimated to be valued at US$ 7.07 Bn in 2023 and is expected to exhibit a CAGR of 5.8% over the forecast period 2023 to 2030.
Regional analysis suggests Europe dominates currently owing to significant North Sea infrastructure reaching end-of-life. Large decommissioning contracts in North Sea are likely to sustain European market share. However, Asia Pacific is expected emerge as a high growth region led by maturing offshore assets in Southeast Asia and China.
Key players operating in the offshore decommissioning market are Acteon Group Ltd, AF Gruppen ASA, Cold cut Systems, Inc., DeepOcean Group Holding BV, DNV GL AS, John Wood Group PLC, Mustang Engineering, Oceaneering International, Inc., Ramboll Group, and Tetra Technologies, Inc. Large integrated players have capabilities across planning, permit applications, wastes management and completion while regional specialist focus on niche service areas. Ongoing contracts and expertise are key competitive factors.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it