Offshore Decommissioning Market
The market for Offshore Decommissioning was estimated at $9.1 billion in 2023; it is anticipated to increase to $17.8 billion by 2030, with projections indicating growth to around $28.9 billion by 2035.
Report Summary
Market Data
Methodology
Table of Contents
Global Offshore Decommissioning Market Outlook
Revenue, 2023
$9.1B
Forecast, 2033
$23.8B
CAGR, 2024 - 2033
10.1%
The Offshore Decommissioning industry revenue is expected to be around $11.0 billion in 2024 and expected to showcase growth with 10.1% CAGR between 2024 and 2033. The market for decommissioning offshore structures like oil & gas platforms is going through changes due to stringent environmental rules & associated high cost for that; and also a rise in the number of old oil platforms reaching the end of their operational lifespan. As of 2023, global offshore decommissioning market was estimated at $9.1 billion and is expected to reach $17.8 billion by 2030 with a growth rate of 10%. By the year 2035 the market is projected to expand reaching a value of $29 billion.
The process of decommissioning facilities is becoming an important industry within oil and gas sector that involves dismantling and disposing of these installations when they are no longer, in use or are deemed obsolete for various economic or environmental reasons like environmental protection or financial viability issues. This procedure includes tasks such as plugging and abandonment of wells and removing topsides and subsea structures while also addressing any site contamination & remediation issues. Offshore decommissioning is well known for its complex logistical requirements and its importance in ensuring that oil and gas companies adhere to regulatory requirements and minimize their impact on the environment
Market Key Insights
- The Offshore Decommissioning market is projected to grow from $9.1 billion in 2023 to $23.8 billion in 2033. This represents a CAGR of 10.1%, reflecting rising demand across Shallow Water Decommissioning , Environmental Remediation and Deep Water Decommissioning .
- Saipem, Halliburton, Baker Hughes are among the leading players in this market, shaping its competitive landscape.
- U.S. and U.K. are the top markets within the Offshore Decommissioning market and are expected to observe the growth CAGR of 7.4% to 10.6% between 2023 and 2030.
- Emerging markets including Brazil, India and Vietnam are expected to observe highest growth with CAGR ranging between 9.7% to 12.6%.
- Transition like Energy Transition is expected to add $990 million to the Offshore Decommissioning market growth by 2030.
- The Offshore Decommissioning market is set to add $14.7 billion between 2023 and 2033, with service providers targeting Platform Removal & Conductor Removal Service Type projected to gain a larger market share.
- With Regulatory compliance, and Aging infrastructure, Offshore Decommissioning market to expand 162% between 2023 and 2033.
Opportunities in the Offshore Decommissioning
The integration of technologies and data analysis, in the management of decommissioning projects has also the potential to greatly decrease expenses and expedite project schedules
Growth Opportunities in Gulf of Mexico and North Sea
U.S. offshore continues to be one of the leading revenue generator for decommissioning service providers, thanks to the numerous older offshore platforms located in the Gulf of Mexico region. Market leaders like Halliburton and Oceaneering International are at the forefront in this sector by taking advantage of a environment and financial encouragements for decommissioning. In this areas competitive landscape focuses on services such, as plugging and marine debris removal. In North Americas business landscape is distinctly different, due to the tendency for companies, in the area to invest more for decommission services that comply with regulations
North Sea region has observed a major increase in decommissioning projects after the oil price decline of 2018, involving key players like Saipem and TechnipFMC stepping up their game. This area stands out for its commitment to sustainability and its drive towards implementing approaches that minimize ecological impact. E&P operators are focused on cutting operational costs and adhering to environmental standards & regulations. The competitive market landscape pushes companies to innovate cost-efficient decommissioning methods which can align with the objectives of E&P players
Market Dynamics and Supply Chain
01
Driver: Regulatory Compliance, and Technological Advancements
Stringent regulations in mature markets like U.K., Norway and U.S. Gulf of mexico create a demand for compliant and eco-friendly decommissioning services, driving growth Continuous advancement in remotely operated vehicles (ROVs) and well plugging tools enable faster and more cost-efficient decommissioning
The vast number of aging oil and gas platforms on marginal oil & gas fields with higher environmental cost in the North Sea, fuels the need for decommissioning
02
Restraint: High Costs
Providing offshore decommissioning services requires a hugh amount of capital & time investment either on technology acquisition or development and creating industry credentials. These factors pose a barrier, for new entrants
03
Opportunity: Expansion into Emerging Markets and Green Energy Shift
The need, for decommission services is increasing with the expansion of oil production in areas such, as East & South-East Asia Pacific region specifically South China Sea, Malaysia Offshore and Western Australia offshore
The shift, towards renewable energy projects specifically wind energy presents an opportunity for companies that presently only cater to Oil & Gas platform decommissioning market
04
Challenge: Regulatory Delays
Capital investment, in decommission projects can be slowed down by approval processes and strict environmental evaluations. This is especially true, in developing areas where regulations are not as efficient
Supply Chain Landscape
1
E&P Operators
BP PlcExxonShell
2
Consulting
Decommissioning Consulting Service ProvidersWood group
3
P&A Service Providers
Plug & Abandonment ServiceTechnipFMCHalliburton
4
Platform Removal to Site Clearance
AkerSaipemAllseas
1
E&P Operators
BP PlcExxonShell
2
Consulting
Decommissioning Consulting Service ProvidersWood group
3
P&A Service Providers
Plug & Abandonment ServiceTechnipFMCHalliburton
4
Platform Removal to Site Clearance
AkerSaipemAllseas
Use Cases of Offshore Decommissioning in Shallow Water & Environmental Remediation
Shallow Water Decommissioning : Companies such, as Petrofac and Subsea 7 are employing lifting methods to disassemble and extract platforms in shallow water regions like the North Sea where aging infrastructure has led to decommissioning activities in line, with European Union regulations to minimize environmental impact.
Deep Water Decommissioning : In deep waters, specialized methods are needed for platforms because of the extreme environmental conditions. Companies, like Technip FMC and Oceaneering International have created robots to handle dismantling platforms effectively ensuring plugging of wells and removal of structures in tough circumstances
Environmental Remediation : Companies, like Boskalis and Wood Group are involved not only in decommissioning but also in environmental cleanup post decommission with a target regions like North Sea and Gulf of Mexico known for their strict environmental policies concerning marine ecosystems
Conductor Removal : Involves cutting and removing conductor pipes used in offshore drilling. Companies like Saipem and Allseas specialize in this area, applying cutting-edge technology to remove complex underwater structures, ensuring minimal ecological disruption
Recent Developments
These recent advancements underscore the emphasis, on cutting expenses and embracing advancements within the industry sector. In October 2023 Technip FMC further revealed its plans to incorporate state of the art digital project management solutions into its decommission services
October 2023 : Halliburton recently unveiled a set of ROV centered decommissioning solutions with the goal of cutting expenses by 20%
June 2023 : Saipem recently revealed an agreement, for dismantling deep water platforms in the North Sea
March 2023 : Petrofac broadened its range of services to cover well plugging and abandonment, in the Gulf of Mexico
Impact of Industry Transitions on the Offshore Decommissioning Market
As a core segment of the Oil & Gas industry,
the Offshore Decommissioning market develops in line with broader industry shifts.
Over recent years, transitions such as Energy Transition and Circular Economy have redefined priorities
across the Oil & Gas sector,
influencing how the Offshore Decommissioning market evolves in terms of demand, applications and competitive dynamics.
These transitions highlight the structural changes shaping long-term growth opportunities.
01
Energy Transition
The worldwide movement, towards renewable energy and sustainable practices has sped up the process of decommissioning
02
Circular Economy
Offshore decommissioning is, in line with the principles of an economy. This means that materials, from platforms can be reused or recycled