The UK is pushing for electrification of some oil and gas hubs in the central North Sea to reduce emissions from upstream operations, following in Norway's footsteps.
Regulator the Oil and Gas Authority (OGA) says the UK will still need "native hydrocarbon resources even in an accelerated energy transition", but must have lower emissions intensity. "We expect the industry to go a bit further and faster on net zero," OGA director of operations Scott Robertson says. "Its social licence to operate is genuinely under threat. It is doing a lot, but it needs to show real evidence of action." The electrification of oil and gas hubs will be essential, he says. "It is a tried and tested technology in Norway. The UK does have some barriers to overcome, but it needs to happen in the interest of dramatically reducing the sector's emissions from power generation."
The OGA estimates that the integration of offshore energy systems — including oil and gas, renewables, hydrogen and carbon capture and storage (CCS) — could "deliver around 30pc of the UK's total carbon reduction requirements needed to meet the 2050 net zero target". And it says that electrification could cut CO2 emissions from UK continental shelf oil and gas operations by 2mn-3mn t/yr by 2030 — equivalent to a 20pc reduction compared with now, and rising to a 40pc cut by 2030 as UK offshore production declines.
Norway's oil and gas industry mostly runs on electricity generated on site using gas turbines, and accounts for about a quarter of the country's total carbon emissions. "Power from renewable energy production or gas-fired power plants with CO2 management can replace parts of today's polluting power generation on the oil platforms," Norway's state-controlled Equinor says. Thanks to electrification, its giant Johan Sverdrup field has CO2 emissions of 0.67 kg/bl of oil equivalent (boe), compared with Norway's average of 9 kg/boe and a global average that is double that.
The second phase of Johan Sverdrup will supply nearby fields with power from onshore facilities in 2022. "Emissions savings from all the fields connected to the area on the Utsira High are estimated at around 1.15mn t/yr of CO2 on average," Equinor says. Other plans include supplying the Gullfaks and Snorre platforms with electricity from the Hywind Tampen floating offshore wind project — the first of its kind to power oil and gas platforms — from 2022. Eight Norwegian fields are now powered from shore. The Norwegian Petroleum Directorate sees more than half of Norway's oil and gas production running on power from shore by the mid-2020s, reducing total Norwegian greenhouse gas emissions by 10pc.
Ruling the waves
In addition to pushing for reduced emissions from UK offshore operations, the OGA is "engaging with operators on more extensive repurposing of offshore infrastructure" to support the UK government's 2050 net zero emissions target. "Some assets in the basin now have the chance of a function beyond their current hydrocarbon-related use, contributing to the energy transition demands of society," it says. Decommissioning cost estimates for the UK offshore have fallen to around £51bn ($68bn) this year from almost £60bn in 2017, but more needs to be done to drive costs down further, it says.
"A healthy North Sea energy industry, with oil, gas, offshore wind and CCS all playing their part" is needed to make the energy transition a reality, according to UK upstream independent Spirit Energy's executive vice-president for technical and operated assets, Neil McCulloch. Upstream companies have accepted that "the energy transition is not a choice, it is a necessity" to continue to attract investment in the basin, he says.
