Well-Safe Introduces Five P&A Clubs
- Business & Finance
Well-Safe Solutions said it has now set up five different P&A clubs to reduce the cost of well plug and abandonment, following interest by operators in the North Sea.
The P&A club concept, launched recently by the Aberdeen-based well abandonment specialist, introduces a new commercial model that tackles late-life activity.
By becoming a member of Well-Safe’s P&A club and adding their well stock into the club, operators can spread the risk and cost of plugging and abandoning wells with others in the Club and use economies of scale to safely remove hundreds of wells rather than focusing on individual wells, or a smaller numbers of wells, the company explains.
The club approach is designed to reduce costs by 35% or more by leveraging campaign-based savings, not only for small well counts, but also by spreading spend. It offers flexibility to phase abandonment expenditure through the club’s programme of work to maximise knowledge capture and management from a multi-operator well campaign approach. It also offers cost certainty, while minimising risk and non-productive time.
The positive reception from North Sea operators to this approach convinced Well-Safe to set up five clubs focusing on the following onshore wells using a land rig and offshore wells using jack-ups, semi-submersibles, well intervention vessel (category 1 and 2 wells) and a deep water asset. Having the five different clubs, designed around the asset types, gives Well-Safe the ability to deliver P&A operations on all well types.
Phil Milton, chief executive of Well-Safe, said: “We’re incredibly excited about the potential for our P&A Clubs, which could not only stimulate the decommissioning sector but also give a big boost to companies who want to invest more money on development and production growth opportunities. This investment could also be assisted by Operators using the cost certainty that the P&A club offers to review liabilities being held on company balance sheets.”
Under long-term multi-year contracts, delivered by Well-Safe’s bespoke P&A assets, with agreed inflationary linked increases, subscribers to the Club will be guaranteed long term fixed rates over a 10 to 15 year period, the best-in-class well engineering team and project management, total transparency and shared knowledge management leading to continuous improvement.
“As we get more effective, through retaining and sharing knowledge, we will adjust the cost of the well P&A operations based on greater productivity and faster results. “In addition, the Club can introduce insurance cover to subscribers through tailor-made insurance schemes to cover cost over-runs, perpetuity and liability of field once complete, and project funding is also available and can be linked to decommissioning tax relief payments.”
Well-Safe has already created 30 new jobs in its Aberdeen head-quarters and is currently recruiting for additional personnel. The company has secured its 40,000sq ft marine and logistics base in Dundee and has short-listed a number of marine assets.