OIL & WIND IN SCOTLAND’S NORTH SEA

UK offshore energy: Heading for a conflict of industry? North Sea oil and gas decommissioning is due to step up at the same time as Scotland’s offshore renewable energy industry takes off. Are the UK’s leading offshore energy sectors heading for a resource war?
Sam Phipps, 30 November 2010 (Wind Energy Update)

"The scale of both challenges is great: on the one hand, to take some 285 hydrocarbon installations out of service; on the other, to ramp up Scotland’s offshore wind and tidal capacity in order to help towards a new target of 80% of electricity from renewables by 2020.

"Among the more immediate problems faced by the two industries is a current and pending skills gap…[T]he development of offshore wind could increase competition…Elsewhere, the offshore wind industry could be at the mercy of oil and gas…[because] offshore wind farms…could face cancellation of site leases if their projects are deemed to interfere with work related to oil and gas…[but] to date the two sectors have not targeted the same offshore sites…"

Seajacks Leviathan, a self-propelled, self-elevating unit (SEU) intended for use in harsh environments. (click to enlarge)

"An acute shortage of vessels has prompted concerns over a pending bottleneck and corresponding spike in day rates for vessel hire…[It could cause competition] in the coming years, but not an insurmountable one…[A] number of vessels are under construction, while new turbine designs would generally allow easier access to nacelles…[It is] difficult to predict if the vessel numbers will match projected demand over the next few years because the situation is changing so fast…

"Both sectors are reliant on shared resources – adequate ports and infrastructure, for instance. Yet, rather than painting a picture of two rival industries fighting for limited resources, analysts stress that…Oil and gas service firms are becoming more aware of the opportunities on offer if they diversify into the offshore wind supply chain. Meanwhile, offshore wind stands to benefit extensively from the oil and gas sector’s extensive subsea and offshore experience…"

JB 114 multi-purpose offshore oil and wind jack-up barge recently completed its first assignment installing wind turbines in Germany. (click to enlarge)

"Two recent developments have come as welcome news for both the offshore wind and oil & gas decommissioning markets…Scotland’s first minister Alex Salmond announced a £70m investment to upgrade Scotland’s port facilities…in the next four years, with a potential 28,000 jobs to be created…The planned improvement of ports would be a significant factor in drawing more private sector investment in renewables…

"Separately…Salmond will host a summit between leading oil and gas companies and the offshore renewables sector…38% of the cost of an offshore wind project is spent on marine installation and associated sub-structure activity – where considerable strengths lie in the oil and gas supply chain…[A] considerable number of firms already [operate] in both [oil and gas] and renewables…[They might not end up working in total harmony…[but] the sectors do have enough in common to forge a mutually beneficial relationship."