Exxon forced to decom Bass Strait by 2027

THE national regulator of Australia’s offshore oil and gas industry has hit Bass Strait operator ExxonMobil with three improvement notices and one direction, while also ordering it to engage an independent contractor to assess the stability of its multiple platforms and infrastructure.
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Paul Hunt

Senior Journalist: Energy & Commodities

Paul Hunt

The National Offshore Petroleum Safety and Environmental Management Authority published notices warning ExxonMobil's Australian subsidiary Esso to get its house in order, and plan to decommission its Bass Strait operations. 

In documents made public today, NOPSEMA issued three improvement notices to Exxon around corrosion of oil infrastructure including pipelines, platforms and other pieces of vital infrastructure used across its operations. 

NOPSEMA also issued the company a direction. The direction orders Exxon to engage an independent contractor to audit the integrity of the infrastructure. 

The audit will include everything from wellhead integrity to pipelines and platform corrosion. 

Regulator documents showed serious concern over the Tuna and West Tune oil fields and the platforms associated, where NOPSEMA inspectors have observed widespread corrosion. 

"[Inspectors] outlined at least twenty locations of full penetration corrosion of the steel helideck supporting structure over significant areas," at West Tuna alone according to NOPSEMA. 

"The extensive corrosion to the helideck support structures on the facility could lead to their failure resulting in injury, fatality or multiple fatalities through their inability to support the load of a helicopter." 

The direction forces Exxon to take stock of whether its facilities are sound and robust enough to remove and decommission eventually. 

The audit could mean that decommissioning operations will need to be brought forward. 

According to NOPSEMA documents, the company has until 2027 to complete the audit and plug and abandon old infrastructure and wellheads. 

"To ensure decommissioning activities are undertaken at non-operational facilities in a timely fashion, NOPSEMA has issued a general direction requiring Esso to complete all preparatory decommissioning activities, including plugging or closing wells and commencing topside dismantling, by 2027 and to ensure facilities are maintained so that structures and equipment can be safely removed in the future, or until such time alternative arrangements are approved by NOPSEMA," a NOPSEMA spokesperson told Energy News

Exxon will also have to publicly publish a report on its progress to clean up its operations every 12 months. 

"Esso must explore opportunities to reduce the timeframe for completing the decommissioning activities and report regularly on progress to NOPSEMA," the spokesperson said. 

The oil and gas fields operated by Exxon in partnership with BHP have been in place for decades, in some cases 50 years.

NOPSEMA noted that Exxon had a "large number of assets not in use or soon to cease being used for production." 

All of these assets will be required to be decommissioned and rehabilitated over the next five years. 

It is the first time NOPSEMA has used its new teeth after the federal government sharpened regulations around decommissioning offshore oil projects. 

ExxonMobil had been looking to offload its offshore Gippsland Basin projects, which would also have relinquished it of its decommissioning liabilities. 

It ultimately dropped the sale of the giant gas fields off the coast of Victoria in November last year, around the time new regulations regarding environmental plans were introduced by the government.

The regulations state that all current and future offshore oil and gas operators need to publicly publish their plans to decommission their projects. 

It comes just months after Woodside Petroleum was issued enforcement action over its Nganhurra riser turret mooring at the Enfield oil and gas project offshore Western Australia.

The Nganhurra RTM has been sitting in deep waters after Woodside could not tow it to shore, because part of it had corroded so badly.