1. sports
2. diving

_____________________________________________________________________
INTERNATIONAL WORKSHOP ON
RIGS-TO-REEFS:
PROSPECTS FOR LARGE ARTIFICIAL REEFS IN
TROPICAL SOUTHEAST ASIA
IS THERE LIFE AFTER OIL?
_____________________________________________________________________
12-13 November 2013, NUS - Singapore
CONFERENCE REPORT
By
Ms Youna Lyons, Centre for International Law, National University of Singapore
DrM. Ashley Fowler, School of Life Sciences, University TechnologySydney
DrLoke Ming Chou, Tropical Marine Institute, National University of Singapore
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
Table of Contents
I. INTRODUCTION
1. Workshop Background
2. Workshop and Report Goals and Structures
3. Regional Distribution of Oil Installations
4. Participants and Speakers
5. Organisers and Sponsors
3
3
3
4
5
5
II. SESSION 1: THE ECOLOGICAL ARGUMENT
1. Marine Ecosystems of the South China Sea and Surrounding Seas
2. Fisheries and Population Status of Target Species in the South China Sea (SCS)
3. Ecological Function of Artificial Reefs and their Use in the SCS
4. Oil Structures as Artificial Reefs in the South China Sea
5. Main Findings
5
5
6
7
10
14
III. SESSION 2: TECHNICAL FEASIBILITY
1. Characteristics of Offshore Installations in Southeast Asia
2. Issues Linked to Jacket Removal or Structural Integrity Assessments
3. Placement of Artificial Reefs
4. Development of Regional and National Capability
5. Main Findings
16
16
16
17
18
18
IV. SESSION 3: LAW AND POLICY
1. Legacy of Brent Spar in the Interpretation of the International Framework: the
Paradigm of Full Removal
2. Reusing an Offshore Platform as an Artificial Reef is not Prohibited under
International Law, provided that it is not a Disguised Disposal at Sea, or ‘Dumping’
3. The Legal Regime of Artificial Reefs Depends on their Location and Purpose
4. Transfer of Authority and Residual Liability
5. Fisheries Management Measures: Compliance/Enforcement Issues
6. Impact on Endangered Species Living on or around a Disused Platform
7. Status of Regional Rules
8. Main Findings
19
V. SESSION 4: THE BUSINESS CASE
1. A Business Case Driven by Costs
2. Main Findings
29
29
31
VI. RECOMMENDATIONS
Recommendation 1: Develop a National Dialogue Across Industry, Government and
Academia
Recommendation 2: Leverage Existing Large Artificial Reefs Programme Knowledge
Recommendation 3: Develop Clear Legal, Institutional and Administrative Rules
Recommendation 4: Improve the Cost-Benefit Assessment of Rigs-to-Reefs
32
19
20
22
23
25
26
26
28
32
32
32
33
2
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
I. INTRODUCTION
1. Workshop Background
1. This workshop is the outcome of a two-year multi-disciplinary discussion within the
National University of Singapore (NUS) between ocean law and policy researchers,
marine biologists and offshore engineers on offshore decommissioning. It was
prompted by (i) the realisation that approximately 500 to 700 offshore installations
in Southeast Asia are reaching or have exceeded the duration of their planned
commercial life, (ii) the observation that complete abandonment is unacceptably
risky; and (iii) the lack of regional information on the topic. The need for action was
compelling, firstly, because ageing offshore structures create environmental and
safety hazards; secondly, there is a potential missed opportunity for development,
whether through the reuse of oil structures when possible for other applications, the
recycling of materials, or the development of a decommissioning market.
2. As early as the 1980s, a coral ecologist in Southeast Asia, Professor Chou Loke Ming
(a key member in the discussion) had already proposed that disused offshore
installations provide an unmatched opportunity for large scale rehabilitation of
degraded coral reefs in the region, as well as the enhancement of marine
biodiversity and fisheries production. However, his proposal did not materialise
given the absence of decommissioning operations, so the debate has remained open
in the region.
3. This ‘rigs-to-reefs’ debate has, however, already developed in the late 1980’s and
1990’s in Europe and the US where opposite paradigms have developed. In Europe
and among environmentalists elsewhere, the idea of reusing a disused offshore oil
and gas installation as an artificial reef (whether in the same location or elsewhere)
is largely seen as a sham designed to conceal illegal disposal at sea, although recent
initiatives such as the Living North Sea Initiative are reopening the discussion on this
assumption. By contrast, the practice in the Gulf of Mexico has long been to reef
disused offshore installations for recreational fisheries purposes.
2. Workshop and Report Goals and Structures
4. This workshop explored the potential benefits, risks and feasibility of rigs-to-reefs
conversion for some 500+ offshore installations that have exceeded or are nearing
the end of their commercial life in Southeast Asia, as a mitigation measure against
the destruction of natural reef habitats and the degradation of fisheries stocks, or
even as an opportunity for sustainable marine commercial ventures.
5. The main goals of this workshop were: (1) to improve the visibility of rigs-to-reefs as
a solution among all relevant stakeholders and discuss the fact that it may not be a
universally accepted solution, (2) to develop a network of regional experts for
knowledge-sharing in fisheries, biodiversity, offshore engineering, environmental
economics, and law and policy, and (3) to identify the main issues involved with the
placement of rigs-to-reefs in Southeast Asia.
3
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
6. This report serves all three goals, as it shares the content and conclusions of the
workshop and provides a basis for discussions to continue. It also includes recent
developments in the field of rigs-to-reefs in Southeast Asia and globally. The four
major sub-themes of ecology, technical and engineering, law and policy, and
business considerations used to structure the workshop discussions are also used
here to structure the main discussions and points made. All the presentations made
at the workshop, together with a research guide and an additional bibliography, are
accessible online, at http://cil.nus.edu.sg/research-projects/ocean-lawpolicy/offshore-installations/rigs-to-reefs/
3. Regional Distribution of Oil Installations
7. It is estimated that the South China Sea and its immediately surrounding bodies of
water– including the Gulf of Thailand, the Java Seas, and the Straits of Makassarcurrently house 1700 offshore installations, nearly half of which are ready to be
retired and many of which are located over the shallow Sunda Shelf. Some of these
installations could potentially enhance biodiversity and contribute to ecosystem
services within the region if they are converted into artificial reefs.
8. Brunei Darussalam, Indonesia, Malaysia and Thailand are the Southeast Asian States
that have jurisdiction over the largest number of these obsolete platforms. Close to
150 installations located within 200 nautical miles of the Brunei coastline are 20
years old or older. However, the large majority of these are located within 12nm of
the coast, whereas the remaining structures are located beyond this. Some oil and
gas operators, such as Brunei Shell Petroleum, are already actively exploring
decommissioning options including rigs-to-reefs.
9. Indonesia’s old offshore installations (350+ are beyond 20 years old) are mostly
located in the archipelagic waters, with only a small number within their exclusive
economic zone. Discussions between offshore operators and the government are
currently taking place towards the development of processes facilitating rigs-to-reefs
as a decommissioning alternative to removal and land scrapping. In Malaysia, of the
300 fixed offshore platforms located in the shallow waters off the coast of
Terengganu and Sarawak, 60% are nearing the end of their production life. Aside
from the significant costs of completely removing obsolete structures, the shortage
of decommissioning yards provides another major challenge in managing onshore
disposal. The opportunity for cost-savings and the enhancement of the marine
environment in the process of decommissioning have now advanced rigs-to-reef
programs as a sustainable decommissioning option in Malaysia. The
UniversitiTeknologiPetronas (UTP) is facilitating national discussion and assisting
development of connections and alternative solutions to decommissioning, including
rigs-to-reefs. Finally, Thailand has 80+ offshore installations that are 20 years old or
older and is also currently developing new decommissioning rules and institutional
arrangements that build rigs-to-reefs into decommissioning options.
4
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
4. Participants and Speakers
10. The workshop extended the multi-disciplinary discussion on rigs-to-reefs by bringing
together marine biologists, law and policy experts and engineers from academia, as
well as government representatives and members of the oil and gas industry. For the
first time, these different groups came to share their perspectives, work and
concerns on the prospects for rigs-to-reefs in Southeast Asia. Among these, marine
biologists and divers from Southeast Asia, Australia and the Gulf of Mexico came to
share their findings and views based on their surveying of artificial reefs in their
respective regions - from former rigs refitted as reefs to artificial reefs made of other
materials.
11. Malaysia and Thailand had large delegations from government and industry as well
as think tanks.
5. Organisers and Sponsors
12. The workshop was co-organised by three research centres of NUS: the Centre for
International Law (Workshop Coordinator: Youna Lyons), the Tropical Marine
Science Institute (TMSI) (Collaborator: Dr Serena Teo) and the Centre for Offshore
Engineering (CORE) (Collaborator: A/Prof QianXudong). The workshop was primarily
funded under the NUS Climate Change and Sustainable Environment Research
Initiative.
13. UTP also provided complementary funding and support for the participation of
representatives from the Malaysian Ministry of Fisheries, Petronas and UTP. UTP’s
critical support showed their commitment to advancing the body of research
available on offshore decommissioning and rigs-to-reefs in Southeast Asia. This topic
is one of the areas of collaboration identified in the Memorandum of Understanding
signed by UTP and NUS.
II. SESSION 1: THE ECOLOGICAL ARGUMENT
1. Marine Ecosystems of the South China Sea and Surrounding Seas
14. Southeast Asia comprises several semi-enclosed yet connected seas including the
South China Sea, the Gulf of Thailand, the Sulu-Celebes Sea and the Java Sea. The
region is considered a global marine biodiversity hotspot, hosting 75% of the world’s
coral species, 40% of the world’s reef fishes, 6 of the 7 world’s marine turtlespecies
(all threatened or endangered), 51 of the world’s 70 mangrove species and 23 of the
world’s 50 seagrass species and generally, in biomass, 30% of the world’s coral reefs,
mangroves and seagrass beds.
15. Overfishing, destructive fishing, sedimentation, marine-based pollution, and coastal
development are major sources of stress on ecosystems in the region, threatening
the existence of close to 90% of the coral reefs, as well as mangrove and seagrass.
The fact that only 8% of Southeast Asia’s reefs lie within marine protected areas
5
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
further enhances their vulnerability. However, given the high productivity of seas in
the region, sessile marine life develops at a fast rate on most subsea structures and
attracts fish. Disused offshore installations therefore constitute an interesting
potential to rehabilitate degraded habitats, rebuild destroyed natural reefs as well as
increase fisheries yields.
16. A prominent feature of the seabed in Southeast Asia is the shallow Sunda Shelf,
which extends from the coastline of Southeast Asia’s land masses far into the
surrounding seas. Most of the 20 to 30-year-old offshore installations of Southeast
Asia are located on the shallow section of this continental shelf (less than 100m
deep). The southern area of these seas (where many offshore installations are
concentrated) are not affected by typhoons, due to the proximity to the equator.
These conditions may facilitate conversion of disused offshore installations into
artificial reefs and decrease risks linked to the integrity of the jacket.
2. Fisheries and Population Status of Target Species in the South China Sea (SCS)
17. Fish is a major protein source for the population of Southeast Asia. Statistics on wild
capture fisheries in the seas concerned are not readily available because they do not
correspond to the FAO’s regions. However, an estimate points to the SCS producing
nearly 13% of the world’s total marine catch, with an overall yearly increase in
capture fishery production of 2-4%. Increased fishing capacity (size and number of
vessels) has largely contributed to this rise in production, but has resulted in a
significant decrease in the abundance oflarge-sized fish, with most of the catch now
composed of a range of smaller, lower-value species used in the production of surimi
or fishmeal. The over-exploitation of marine fisheries resources in the region has
pushed the need for aquaculture to provide the region with protein, income, and
employment. The fact that nearly all the region’s fishmeal is in demand (owing to the
success of aquaculture development) drives overfishing even further. This represents
a dangerous spiral, where increased demand is supporting increased pressure on
already degraded resources.
18. Fishing gears types used in the SCS are very diverse as they include both passive
(traps, gillnets and longlines) and mechanised gears (pushnetting, trawling, and
purse-seining). A large range of vessel types and sizes are also used. High-impact
fishing gears as well as destructive fishing practices in near-shore areas have
significantly reduced the recovery of benthic life and threaten spawning and nursery
grounds.
19. In addition to limited fisheries management measures (domestically as well as at the
regional level), which rarely focus on specific stocks, enforcement measures are also
scarce. This is due primarily to a lack of resources, a very large number of vessels and
the large area of the ocean concerned. Furthermore, despite the substantial number
of declared marine protected areas, very few are effectively protected (such as
critical habitats, spawning and nursery grounds), whether permanently or
seasonally.
6
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
3. Ecological Function of Artificial Reefs and their Use in the SCS
A new habitat for different purposes
20. Artificial reefs are man-made structures deployed to mimic the structure and
functions of natural reefs. They are used globally for a wide range of purposes,
including erosion control, enhancement of fisheries production, replacement of
degraded natural reef, protection from seabed trawling, coral rehabilitation and
marine tourism. Artificial reefs are known to attract fish and have been used by
fishermen for centuries to increase catches. Beyond attraction, artificial reefs are
now believed to boost the productivity of marine ecosystems by enhancing primary
production and increasing the carrying capacity of reef ecosystems through the
provision of additional shelter and feeding opportunities for reef organisms. Artificial
reefs may also enhance the resilience of reef species by acting as ‘stepping stones’
between spatially-segregated populations, thereby enhancing population
connectivity.
The economic argument
21. Studies on the economic value of coral reefs, mangroves and seagrasses in different
marine parks across Southeast Asia reviewed by Conservation International ranged
between 100,000andover5million USD per year, depending on each park’s size,
location and the activities which are being carried out. However these figures are
based primarily on marine tourism activities. The full value of these habitats is likely
to be much greater in the region when factoring in all the different benefits derived
from these ecosystems, in addition to marine tourism.
22. Considering that artificial reefs can assist in the protection or rehabilitation of
natural reefs, then their economic value is clear. However, these potential ecological
benefits to natural reefs may not materialize due to other factors affecting the area,
including pollution, overfishing, eutrophication and sedimentation. In some
cases, deployment of an artificial reef may negatively impact adjacent natural reefs
by altering current flow, attracting fauna away from the natural reef, or even
promoting the spread of exotic and invasive species. Such potential impacts must be
carefully assessed before deployment in order to avoid any economic and ecological
loss.
The production vs. attraction debate
23. The debate surrounding the merits of rigs-to-reefs centres on whether they will
increase the abundance of marine organisms (the ‘production’ hypothesis), or simply
attract and concentrate existing organisms (the ‘attraction’ hypothesis). The
production hypothesis states that the addition of reef habitat will lead to an increase
in resources for reef organisms, through the provision of additional food or shelter
resources, or both. The attraction hypothesis states that artificial reefs will not
increase resources, and will therefore lead to a mere redistribution of existing
biomass by attracting organisms to the site from surrounding reefs. For production
to occur, populations of target organisms must be resource-limited (habitat or food),
so that the artificial reef triggers biomass production that would not have occurred if
the reef was not deployed.
7
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
24. Attraction is usually considered by ecologists as a detrimental outcome for artificial
reef deployments, because the attraction and concentration of sparsely-distributed
species may increase their vulnerability to overexploitation. However, both
production and attraction are likely occurring simultaneously on artificial reefs,
depending on the species considered. Highly mobile species including larger reef fish
are more likely to be attracted to artificial reefs, while less mobile organisms have a
greater chance of being produced at the site. It must also be remembered that
species that are initially attracted to an artificial reef may subsequently be produced
there at a later time, once the reef has become biologically established.
25. Production is difficult to demonstrate scientifically. It requires that a sustained
increase in biomass be detected within the deployment site and surrounding area,
which requires rigorous sampling of marine organisms at the deployment site and
surrounding reefs for multiple years, both before and after deployment.
Furthermore, other environmental and anthropological factors that also impact
biomass through time need to be taken into account, such as climate change
impacts, fisheries pressure and other ocean uses in the area. Although there is
minimal direct evidence of production on artificial reefs, there is circumstantial
evidence of fisheries benefits, including increased catches of red snapper
(Lutjanuscampechanus)in the Gulf of Mexico coinciding with the increase in artificial
reef volume in the region. Tagging and tracking research has also demonstrated high
site fidelity of reef fish around artificial reef sites in numerous regions. In California,
there is a high abundance of rockfishes (Sebastes spp.) around oil and gas platforms,
with just 8 platforms being found to support 20% of juveniles for one species in the
region.
The Thai experience
26. Thailand’s fisherieshave long been recognised as globally significant (one of the top
10 nations in fisheries production since the 1970’s). However, landings of wild
capture fisheries reached a plateau in the early 1980’s and the industry has been in
crisis since. Many Thai fishermen have had to find othersources of income and
cheaper foreign workers have been hired to maintain the industry, which suffers
from ongoing excessive fishing efforts and destructive fishing practices, including
trawling within near-shore areas designated as closed to trawlers, which results in
the destruction of nursery grounds for valuable commercial fish.
27. Fisheries departments in Thailand and Malaysia have a long experience of using
artificial reefs to increase fisheries yield. However, other agencies within these
governments have also deployed artificial reefs for other purposes, especially marine
tourism, experimenting with all kinds of materials, including train carriages, military
tanks, and smaller items such as rubber tires. It is not always clear whether these
placements were mere disposals at sea or whether they were carried out with the
aim of developing artificial reefs.
28. Artificial reef programmes have been developed since the late 1970s. It is reported
that 554 artificial reefs have been installed (custom-built of 517,313 individual units),
both in the Gulf of Thailand and in the Andaman Sea in waters of 3.5 to 50m deep.
8
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
Some of these placements were close to shore (150m away or more), but others
were further away, up to 30.5 km seaward. The overall reported budget for artificial
reef construction and placement between 1978 and 2007 was 1.561 million Baht
(eq. to around USD50,000). Whilst artificial reefs have been constructed from a
diversity of reused material, new concrete structures have also been purpose built
and placed under fisheries enhancement programmes. These structures have been
fitted with anti-trawling devices that snag fishing nets in order to avoid past
situations where the placement of artificial reefs resulted in a decrease in fisheries
catch due to illegal fishing in the vicinity.
29. Since the 1980s, there has been a shift in artificial reef deployment from small
modules (e.g., tires, concrete blocks or pipes, etc.) to much larger ones (e.g., tanks,
trucks or train carriages) and from shallow to deeper waters further from the coast.
Fisheries scientists counted 32 families of fish larvae prior to the placement of
artificial reef and 37 families two months after the deployment of the artificial reef.
They also found 182 fish species from 54 families around artificial reefs located in
the Gulf of Thailand within five years of deployment. The landings of small scale
fisheries operating at these sites is also reported to have increased by 1 to 5 times,
depending on the species, in locations where there was effective control of the
number of fishing boats and the type and number of fishing gear permitted.
30. While a wide range of reef types have been constructed in Thailand, there is no
precedent to date for the use of obsolete offshore structures and therefore a crucial
lack of data with which to predict the performance of a large-scale programme.
Participants in the workshop reported that in some fields in the Gulf of Thailand, the
offshore industry is partnering with marine scientists to establish biomass baselines
so as to get a better idea of the life supported by offshore platforms still in their
production phase.
The Malaysian experience
31. Malaysia has been deploying artificial reefs since the 1970s primarily to increase
fisheries yield, protect the marine environment and for recreational uses, including
marine tourism. Although many different authorities have deployed artificial reefs
for different purposes, the main ones are the Department of Fisheries of Malaysia
and the Fisheries Development Board of Malaysia. The Department of Fisheries of
Malaysia regulates fishing near conservation areas where artificial reefs are located
by banning fishing within 0.5 nautical miles from the sites. In contrast, the Fisheries
Development Board of Malaysia deploys artificial reefs to enable artisanal fishers to
secure access to fish. In 2010, they had together deployed artificial reefs in 79 sites,
with each reef comprised of 10 to 72 modules.
32. Artificial reefs in Malaysia are made from a variety of materials, including reinforced
concrete, tyres, ceramic, fiberglass, retired fishing vessels and pvc, depending on the
purpose of the artificial reef and materials available. They can also be of different
sizes comprising several modules. Modules of more than 10 tonnes are considered
to be ‘large-size’ artificial reefs and more successful at attracting fish. These reefs are
also more successful than smaller reefs at deterring trawlers from operating around
9
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
them, due to the increased risk of catching and damaging nets. For example, postdeployment monitoring of artificial reefs in Malaysia revealed an estimated 2000 fish
around and within a module of a large-scale artificial reef in Terengganu after just 11
months of deployment. At another site of a large artificial reef, soft coral
communities and sponges were recorded four years after placement, together with
80 commercial species, including several fish, crab, lobster and shark species. Green
turtles were also observed in the area and are believed to have taken refuge there
whilst migrating. There is a general presumption that large artificial reefs induce upwelling that in turn provokes phytoplankton blooms that attract many species of
pelagic fish.
33. A socio-economic study on the impact of deployment of large-scale artificial reefs on
artisanal fishers in Malaysia has also found that such reefs ultimately increase the
income of most artisanal fishers. The large artificial reefs that have been studied the
most are the ones built from new material (generally reinforced concrete), are
designed to last 50 years and cost between RM 540,000 and RM 4 million (eq. to
around USD15,000 and USD1.1million). Overall, more than RM155 million has been
spent on artificial reefs between 1976 and 2010, of which RM34 million was for
large-size artificial reefs. Malaysia’s future artificial reef programme includes new
steel structures built in Japan which, although different in design from the jacket of
an offshore platform, present similarities that justify consideration of the reuse of
local offshore jackets. The apparent ecological success of Baram-8, which is the only
artificial reef made from a converted oil rig in Malaysia, indicates that reefs
constructed from obsolete offshore platform jackets are capable of developing
flourishing reefs (see section 4 below for further discussion of the Baram-8 case
study).
Current state of knowledge
34. Although the development of artificial reefs in the South China Sea is not a recent
phenomenon and there is increasing interest and awareness of their potential
ecological and economic benefits, there is no accepted methodology or a clear
understanding of the control parameters to be taken into account to ensure a
successful placement. Furthermore, questions typically raised in the context of the
placement of a purpose-built artificial reef tend not to include those that are specific
to the reuse of offshore installations, such as the impact of the removal of a jacket
before placing it elsewhere, or whether it may make ecological sense to leave it
where it is located. The reason for this seems to be the lack of experience in the
region. Further regional monitoring of existing artificial reef sites and research are
necessary to determine the potential benefits and pitfalls of conversion of disused
oil structures into artificial reefs.
4. Oil Structures as Artificial Reefs in the South China Sea
How they work: expected ecological benefits
35. The expectation is that ‘rigs-to-reefs’ conversions would bring enhanced biological
productivity (including increased fisheries yields), prevent trawl damage and
improve the population connectivity of reef species. The complex structural design
and composition of oil structures, with their many crossbeams and large interstitial
10
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
spaces, create favourable conditions for the development of artificial reef habitats
that support high diversity and abundance in areas where such habitat may not have
naturally developed. Research on oil platforms in both California and the Gulf of
Mexico has shown that steel structures create suitable habitats for invertebrate and
fish assemblages. The settlement of shallow-water corals has also been found to be
higher on painted steel than on concrete structures, indicating that the steel
composition of rigs is suitable for invertebrate colonisation and growth.
36. However, rigs-to-reefs programmes also bring with them a set of potential
environmental issues, including direct or indirect physical habitat damage
(depending on the placement method and proximity to natural habitats), pressure
on fisheries resources (if they attract fish and facilitate exploitation), the spread of
invasive species, change of marine food webs, the release of contaminants over
timeand the disruption of the normal functioning of marine ecosystems in the
deployment area.
How they work: practical steps
37. When an offshore installation is to be retired, the topside is removed and the
structure of the jacket is cleaned and disconnected from connectors and cables so
that the only remaining part is the steel jacket. Potential contaminants such as antifouling coatings on the steel may need to be investigated and removed if they do not
meet minimum toxicant guidelines.
38. A wide range of reefing options is available and the selection of a particular option
must reflect the purpose of the artificial reef and local restrictions. The jacket can be
left in situ, either in whole or in part, where a portion is severed from the rest of the
jacket and either (i) placed on the seabed next to the jacket, (ii) transported to be
placed elsewhere on the seabed, or (iii) brought to shore for reuse or disposal.
Similarly, the jacket can also be entirely severed from the seabed (below the
mudline) and either toppled in the same location, placed elsewhere on the seabed
or brought to shore. Removed jackets may be placed on the seabed for disposal (also
called ‘dumping’) or for reuse as an artificial reef, whether for fisheries, marine
tourism, reef rehabilitation or other purposes.
Potential negative impacts
39. Where an artificial reef is created using an offshore rig removed from another
location, a major potential impact is the spread of invasive species. This may occur if
encrusting or fouling organisms on the surface of the jacket (or pipelines or other
parts) are not removed prior to the transport and deployment of the jacket (and
other parts) as a reef. The dispersal of such species can even be facilitated by
relatively ‘clean’ jackets (or other parts of offshore installations), depending on the
particular organisms present on them, as well as the physical and biological
conditions of the chosen site. Surveys should be carefully conducted for potential
invasive species prior to both the removal and relocation of an oil structure,
especially if it is to be deployed in a sensitive marine ecosystem.
40. Another potential negative ecological impact is the destruction of inhabiting
communities during the process of severing the structure from the seabed and,
11
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
more generally, any physical damage created in the ‘drop zone’. Changes in marine
food webs can also result from any new community that establishes itself on the
artificial reef, especially if the artificial reef ‘replaces’ a soft benthic community. In
Alabama, the addition of a large number of individual reefs resulted in a regional
increase of red snapper (Lutjanuscampechanus) populations which, while being a
positive outcome from a fisheries perspective, raised concerns about the abundance
of native soft-bottom communities. Is there a large-scale impact of the replacement
of soft benthic ecosystems? At what point does such replacement become
undesirable?
41. Many also fear a risk of a different nature, which is the potential release of
contaminants from the degradation of a rig over time. However, there is little, if any,
published study on this topic. It seems that the extent of the risk would be limited if
the reefed rig is a clean jacket made of bare steel, and would likely exhibit
degradation characteristics similar to that of a wrecked steel vessel. However,
contaminants may come from coating paints on the rig, or if pipelines and other
subsea devices (such as the Christmas tree, the assembly of valves, spools, and
fittings used to control the flow from oil and gas wells) are reefed together with the
jacket. The risk of pollution would then depend on the cleaning process used on
these parts prior to reefing them.
42. Where an artificial reef is created by leaving an obsolete offshore rig in place, the
above negative impacts may have already occurred through initial placement of the
structure, and therefore they present less of an issue at the time of
decommissioning.
The example of Baram 8
43. In Malaysia, Petronas – as the national oil company and sole concessionaire of
petroleum resources in Malaysia - requires operators to conduct a best practice
study on the environmental and economic impact of the different options for
decommissioning. The successful conversion of the Baram-8 oil rig was the first of its
kind and resulted from such a study. Although the rig had collapsed in 1975, the first
study of its collapsed situation and the options for its decommissioning began in
2000. Shell, as the former operator of the rig, was responsible for the
decommissioning costs, but the decommissioning option (full removal, disposal at
sea or on shore, etc.) and the process to be followed had to be agreed with Petronas
and the other relevant government agencies. The decision to reef this rig followed
the request to use the rig as an artificial reef by the Deputy Minister of Sarawak and
the nomination of the Department of Fisheries of Sarawak as the responsible entity.
44. Baram-8 was salvaged in 2004 and towed for 25nm. Its present location is 8nm
offshore from the coast, in South Siwa (off Miri). The artificial reef is composed not
only of the jacket but also of loose cuts and braces, conductors and the christmas
tree, after they had been sealed and cleaned. It is located in 21m of water and the
top is 14m below the sea surface. The area has since been included in a new
gazetted marine protected area of 1180 km2 (the Miri-Sibuti Coral Reef National
Park). Baram-8 is monitored by marine biologists and has been the subject of two
12
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
biodiversity and biomass surveys, whilst under the responsibility of the Department
of Fisheries of Sarawak. The 2005 survey reports large schools of juvenile jacks
(trevallies) and larger-sized groupers among the many species of fish present in and
around the structure. The need to manage the competing users of the Baram-8
artificial reef (artisanal fishers and recreational divers) is a pressing one, and this is
expected to be addressed in a fisheries and reef management plan currently being
developed by the Sarawak Forestry Department.
The Gulf of Mexico
45. Evidence of effective ecological functions of artificial reefs can be seen from
converted oil structures in the northern Gulf of Mexico, where observations of fish
communities have revealed that a high abundance of fish can be found around largescale artificial reefs made from converted oil platforms. Key local parameters in the
deployment of rigs-to-reefs programmes in the Gulf of Mexico are (i) the fact that
the seabed is predominantly made of mud and/or sand (not a reef-building
substrate) so artificial reefs have the potential to create additional refuges for reef
species (including soft and hard corals); and (ii) the large number of offshore
installations that will become available for reefing as a result of the ‘idle iron’ policy.
46. In the Gulf of Mexico, decommissioned offshore installations are sometimes toppled
in situ (the upper section of the jacket is severed from the bottom section so that the
latter does not interfere with navigation) and sometimes relocated to a designated
‘reefing’ area selected for development of a network of artificial reefs. Initially, the
main criteria for the selection of these areas focused on their accessibility by
commercial and recreational fishermen who were seen as the primary users of these
artificial reefs. Spatial planning is now developing to improve the selection process
for the location of the reefing area, taking into account all the interests that may be
affected and comparing the ecological characteristics of possible reefing sites.
47. Nevertheless, surveys of marine life on and around offshore installations suggest
that the removal of one platform can equal the removal of large areas of natural reef
(where the platform had been colonised by coral). Furthermore, explosives used to
sever the jacket from the seabed are likely to kill surrounding fish; this is a difficult
issue in the Gulf of Mexico where industry practices and fishermen’s interests often
conflict.
48. Although rigs-to-reefs conversions in the Gulf are generally seen as beneficial to
recreational fisheries (such as the line-fishing industry for red snapper), considerable
research is required to confirm the ecological benefits of the practice. These
include:(i) investigations of the marine life developed on and around these
structures, and the extent of seasonal variation; (ii) the importance of the location,
distance to the shore, water depth and proximity to other habitats (artificial and
natural); and (iii) whether the fisheries yield is greater from toppled jackets, cut-off
jackets or jackets left as-is. Another recurring and debated question is whether
artificial reefs are net fish producers, or whether they merely attract fish and thus
put already exploited species at even greater risk of overfishing. The Gulf of Mexico
13
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
is the region of the world where the greatest number of hours has been spent
documenting marine life surrounding artificial reefs, especially former rigs refitted as
artificial reefs.
Western Australia
49. The Scientific and Environmental ROV Partnership using Existing iNdustrial
Technology (SERPENT) network, which is a global collaboration between
environmental researchers and the oil and gas industry, uses industrial remotelyoperated vehicles (ROVs) to study the life surrounding offshore installations and the
deep seabed. Research conducted by SERPENT off the northwestern coast of
Australia has revealed that a diverse range of fish species associate with offshore
structures, from small reef-dependent species through to transient pelagic species.
Over 30 fish species were observed associating with smaller structures, including 10
species of commercial value in the region. Mangrove jack
(Lutjanusargentimaculatus, a valuable commercial species) has been observed in
particularly high abundance around some structures. Further research by SERPENT in
the region has demonstrated for the first time that oil structures are capable of
sustaining populations of reef fish. This research indicated that oil structures are
capable of providing quality habitat that is capable of producing biomass, not just
attracting it from surrounding areas.
5. Main Findings
Finding 1: The South China Sea and surrounding basins present particular ecological
and socio-economic characteristics that need to be taken into account in the design
of rigs-to-reefs programmes.
50. These particular ecological and socio-economic characteristics include: fisheries
productivity, population dependence on fisheries (for subsistence and commercial
purposes), and the developing status of most coastal States including poor
enforcement capabilities.
Finding 2: In essence, the rigs-to-reefs concept is not different from that of a large
artificial reef.
51. The difference lies in the leverage of a material opportunity created by the
availability of specific structures, i.e., retired offshore installations. However, the
ecological questions are identical, as are those linked to institutional responsibility,
placement, on-bottom stability and interference with other legitimate uses of the
sea.
Finding 3: There is a clear opportunity to harvest the existing regional artificial reef
expertise for rigs-to-reefs purposes through the development of communication
channels between oil and gas industry and relevant government agencies (at
national and local levels).
52. This session demonstrated the long-term commitment and expertise of Malaysia and
Thailand with artificial reefs for a variety of purposes and the current trend towards
a preference for large-scale reefs. Fisheries enhancement and management is the
primary use followed by marine tourism. However, there is little if any
communication between artificial reef scientists and artificial reef builders and the
14
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
oil and gas industry. The first observation is that there is an alignment of interests
between the needs of the oil and gas industry to decommission disused installations
and the national needs for artificial reefs for different purposes. The development of
a discussion between the oil and gas industry and relevant national agencies is
necessary to investigate in greater detail common interests and processes for the
implementation of successful rigs-to-reefs programmes.
53. Furthermore, cooperative mechanisms between the oil and gas industry and
relevant government agencies managing rigs-to-reefs programmes would also allow
the sharing of ‘grey’ literature generated in this field (by government, private
consultants and the industry) but not made publicly available.
Finding 4: Because of the inevitable attraction of fish to artificial reefs, any rigs-toreefs programme needs to be included within a broader fisheries management
strategy.
54. Rigs-to-reefs is not a stand-alone solution. It must be developed with other
management tools. This is true whether the artificial reef is being deployed for
fisheries or for another purpose such as marine tourism.
Finding 5: Region-specific monitoring and research of marine life developing in and
around existing offshore installations during exploration and prior to removal is
necessary to identify the most suitable decommissioning option.
55. Ecological surveying and monitoring of existing installations and sharing of the
results would be the easiest way to start this process. Very few studies of this type
are currently available, despite several participants indicating that such preproduction surveying and ongoing monitoring during production are currently being
undertaken by operators in Thailand and Malaysia.
56. Most scientific data gathered to date come from the Gulf of Mexico and California.
Similar data are lacking in the Southeast Asian region, which limits any assessment of
the ecological benefits and costs of a regional rigs-to-reefs program. This in turn
limits the development of the rigs-to-reefs business case for the industry.
Finding 6: Region-specific research on net environmental benefits provided by
artificial reefs is needed to support the development of rigs-to-reefs programmes
57. To ensure comparability, it would be useful if a similar analytical framework was
used to assess the ecological performance of artificial reef deployments in the
region. If that is not feasible, it would be preferable that the same categories of
benefits and impacts considered for rigs-to-reefs deployments be examined for large
artificial reef installations. Findings from current research on artificial reefs could
then be used to understand the outcomes of future rigs-to-reefs deployments.
Finding 7: Rigs-to-reefs can be deployed on a range of scales, from national to
regional, and from a group of platforms to local community-based deployments of
single installations.
58. Goals will differ depending on the scale and location of rigs-to-reefs deployments,
and the opportunity for deployment will depend on the local stakeholders involved.
The example of Baram 8 suggests that community-based deployments may be the
15
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
easiest to facilitate, as the potential benefits are likely to align with the goals of key
stakeholders (be it fisheries or marine tourism for example).Such deployments
would need to be supported by additional expertise if required, realistic
management plans and effective implementation of local compliance mechanisms.
III. SESSION 2: TECHNICAL FEASIBILITY
59. Aging offshore installations in Southeast Asia and in other parts of the world were
installed to withstand the climatic risks and last beyond the time of their expected
commercial use, generally around 20 to 25 years. They were not designed or built to
be removed or used beyond their commercial use-by date.
60. The technical feasibility and practical considerations of the reefing of obsolete
offshore structures raises questions about the suitability of the type of structures
used throughout Southeast Asia, and the inherent difficulties and risks associated
with dismantling and placing a jacket at a given location.
1. Characteristics of Offshore Installations in Southeast Asia
61. In Southeast Asia, aging offshore installations have specific physical
characteristics.They are typically small steel jackets weighing less than 4000 tonnes,
and are located primarily in shallow waters (less than 100m deep). Many only have
four legs.
62. Given the very high biodiversity of the seas of Southeast Asia, offshore installations
appear to be frequently covered with threatened or endangered species (e.g. black
coral) or can even house migratory endangered species.
2. Issues Linked to Jacket Removal or Structural Integrity Assessments
Jacket fatigue and structural integrity
63. The parts of offshore installations that tend to age first are the anodes or welded
joints that connect different parts of the steel jacket together. Past decommissioning
operations have demonstrated that many of them have disappeared by the time the
decommissioning operations occurred. Their disappearance weakens the structural
strength of the jacket, which is why they need to be investigated (with a Remotely
Operated Vehicle, ROV) prior to removal operations.
64. Another challenge with respect to the assessment of the structural integrity of a
platform 20+ years after its placement is the fact that the installation plans and
subsequent modifications or reparations are often not transferred to the final
operator charged with the responsibility of removal.
65. Finally, also of relevance to platform structural integrity is the presence and amount
of encrusting organisms that increase the hydrodynamic load and therefore weaken
the structure. This will be a greater concern in shallow tropical seas if no mechanism
16
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
has been put in place for regular clean-up of this ‘marine growth’, as it is generally
referred to in the offshore industry.
Removal
66. Offshore engineers emphasise that platform removal is not a reverse installation, as
they were not designed to be removed. Furthermore, it is still a relatively new
activity in the industry and the procedures are not standardised, especially not
globally.
67. When an offshore jacket is totally removed in the North Sea or in the Gulf of Mexico,
the standard industry practice requires that it be cut 6m below the mudline. The
rationale for this rule is to minimise the risk of the remaining piles being uncovered
in the event of a sediment shift (a small mudslide) and becoming a hazard. Where
the seabed is made of hard substrate, cutting at seabed level to remove an offshore
jacket may be acceptable (and even less environmentally invasive) if there is no risk
of a sediment shift.
68. The structural strength of the jacket is designed to resist all forces applied during
installation and use. However, the impact from up-lifting was not considered,
especially not after it has been weakened by 20+ years of use and after parts of
jacket legs have been cut off. Difficulties linked to the up-lifting increase with
depth.The risks created by the removal of an offshore platform depends on many
factors including the size of the platform, its age and structural integrity, the
weather and sea condition and the depth to which the jacket has been installed.
These factors influence the lifting process (numerous piecemeal lifts or a single lift)
to be adopted and the overall removal cost involved which increases with the time it
takes to complete the job due partly to the rental of the equipment and resources
needed for the job, especially lifting vessels.
69. Cutting rules to remove the jacket vary depending on the domestic laws that are
applicable. Although explosives are considered engineered cutting methods and
generally cheaper, they are not allowed in all areas due to the environmental impact
of the blast. However, new technology is being developed to contain the effect of
the blast to a smaller area surrounding the cutting operations.
70. These engineering challenges are the subject of research and development of new
engineering solutions including solutions relating to structural models, structural
integrity verification, new lift configurations, new cutting tools and disposal
engineering.
3. Placement of Artificial Reefs
71. It must first be noted that if a platform is left in situ after cleanup and removal of the
topside, fatigue becomes less of a concern due to the structure no longer having to
carry the top-side. The situation is however different if the jacket is cut from the
piling and brought to a new location.
17
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
72. With respect to the horizontal placement of a jacket on the seabed (or toppling), the
risks attached are dominated by the on-bottom stability, which requires that the
lateral deflection created by current and waves doesnot exceed certain limits. Depth
is also a factor in the ability to position a disused rig in a precise location as it may
impact the ability to adjust through re-lifting and repositioning.
4. Development of Regional and National Capability
73. Following the success of the converted Baram-8 oil rig, the Sarawak state
department has actively been seeking engagement with stakeholders to support
future rigs-to-reefs activities. However, being a new market for decommissioning,
Malaysia has yet to undertake an actual assessment of the capabilities of the local
industry to handle the process of reefing a rig. It also lacks expertise, both on the
side of operators and the government, regarding the various methods of converting
disused platforms into artificial reefs.
5. Main Findings
Finding 1: Decommissioning is not reverse engineering
74. Platform removal is not simply a case of reversed engineering because platforms
were designed to remain in place. Furthermore, removal was not taken into account
when offshore engineers constructed and installed platforms more than 20 years
ago. Cost and time of removal are difficult to predict, and engineers estimate that
overall costs for operators and governments (depending on national rules) are likely
to exceed expectations dramatically.
Finding 2: Missing documentation
75. The fact that original installation plans might not include subsequent reparations and
modifications and have generally not been passed on to the last operator make
structural integrity assessment more difficult. This can also make removal of
offshore platforms more difficult. It may also impact the transformation of an
offshore installation into an artificial reef if the intention is to remove the platform
and topple it.
Finding 3: Full removal can be cheaper than partial removal
76. Provided that the structural integrity of the platform permits, full removal in a single
lift is faster, easier and therefore cheaper than jacket cutting and partial jacket
removal. This means that it can be cheaper to remove the whole installation rather
than leave a part in place for deployment as an artificial reef.
Finding 4: Constraints to redeployment of an offshore jacket as an artificial reef
77. Redeployment of an offshore jacket as an artificial reef is technically feasible
whether in the same or in an alternate location. However, if a jacket is wholly or
partly left in the same location with initial pilings, concerns as to structural integrity
are alleviated by the removal of the topside it was designed to support.
18
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
Finding 5: Risks associated with horizontal placement on the seabed
78. In situations wherean entire offshore platform or parts of it are removed
andhorizontally placed on the seabed, the risks attached to this placement are
dominated by the on-bottom stability of the structure (depending on currents and
wave action).
Finding 6: More research is needed in offshore reefing engineering in Southeast Asia
79. Offshore reefing engineering is not yet developed in Southeast Asia, but experience
can be drawn from the decommissioning industry in Europe and the Gulf of Mexico,
as well as from Japan’s artificial reef engineering experience.
IV. SESSION 3: LAW AND POLICY
1. Legacy of Brent Spar in the Interpretation of the International Framework: the
Paradigm of Full Removal
80. There is a general perception that the primary solution to offshore decommissioning
for disused installations is full removal from the seabed and scrapping ashore. This
current view finds its source in the history of international law as well as in the Brent
Spar incident.
81. This strict obligation of removal has its roots in the 1958 Convention on the
Continental Shelf, which strictly provides that any abandoned or disused offshore
installation must be entirely removed. However, the very large costs associated with
this strict obligation resulted in lobbying to soften this rule during the negotiations of
the United Nations Convention for the Law of the Sea (UNCLOS) from the 1970s to
the 1980s. This resulted in the insertion of provisions in UNCLOS that envisaged the
partial removal of disused offshore installations and structures and further
development of this concept in the 1989 IMO Guidelines and Standards for the
removal of offshore installations and structures on the continental shelf and in the
exclusive economic zone (1989 IMO Guidelines and Standards).
82. However, the Brent Spar incident showed that the circumstances in which nonremoval or disposal at sea may be acceptable are disputed. One of the repercussions
of the Brent Spar incident is the current paradigm that allowing part of the rig or the
rig in its entirety to remain in the ocean constitutes ‘dumping’, unless it can be
proven otherwise. The Brent Spar was a 14,500 tonne oil storage and loading
platform in the north Atlantic. Operated by Shell under the jurisdiction of the United
Kingdom, the Brent Spar had been approved by the UK government for its disposal
at sea. This was, however, met by a sustained and highly publicised campaign by
Greenpeace whose activists objected and physically occupied the installation in
order to prevent its deep-sea disposal.
83. Up until 1995, the OSPAR Convention permitted the disposal at sea of parts or all of
the disused offshore installations under certain circumstances. Following the
political and environmental scandal that was the decommissioning of the Brent Spar
19
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
(in 1995), the OSPAR Commission agreed (in 1998) that all North Sea structures
weighing less than 10,000 tonnes must be totally removed, with the general
presumption being that all offshore installations will be reused, recycled, or disposed
of on land. Exceptions to such rules would be assessed on a case-by-case basis. The
adoption of the 1999 OSPAR Guidelines on Artificial Reefs in relation to Living
Marine Resources effectively prevented the reuse of platforms as artificial reefs by
requiring that artificial reefs be constructed from virgin materials only.
2. Reusing an Offshore Platform as an Artificial Reef is not Prohibited under
International Law, provided that it is not a Disguised Disposal at Sea, or ‘Dumping’
Reuse of an offshore platform as an artificial reef is not prohibited (provided the
purpose is legitimate) in Southeast Asia
84. UNCLOS and the dumping regime do not prevent the ‘placement of matter for a
purpose other than the mere disposal thereof’, provided that it is not contrary to
these rules. This is further confirmed by the 1989 IMO Guidelines and Standards,
which allow for partial removal in specific circumstances and specifically provide that
materials from removed installations and structures may be placed on the seabed to
enhance living resources.
85. Unlike northern Europe, there is no regional convention in Southeast Asia that
provides region-specific rules for the protection of the marine environment, other
than some non-binding declarations and soft-law instruments negotiated under the
auspices of Association of Southeast Asian Nations (ASEAN) and the Partnerships in
Environmental Management for the Seas of East Asia (PEMSEA). The only
international binding rules that are applicable are therefore UNCLOS, the 1972
Convention on the Prevention of Marine Pollution by Dumping of Wastes and Other
Matter (the 1972 London Convention) and its 1996 Protocol.
Disposal at sea requires special authorisation and impact assessment as provided in
the 1972 London Convention and its 1996 Protocol
86. UNCLOS and the 1972 London Convention allow for offshore installations to be
disposed of at sea, subject to obtaining a permit.
87. It must be noted that there is little doubt that the 1972 London Convention qualifies
as a ‘global rule and standard’ within the meaning of articles 210 and 216 of
UNCLOS, which has been adopted by all the offshore producing States of Southeast
Asia. This means that all States, irrespective of whether they are party to the 1972
London Convention, must adopt measures that are at least as effective as those of
the Convention in limiting disposal of waste at sea.
88. The standard set in the 1972 London Convention for the approval of permits for the
disposal of offshore installations, together with the obligation of due diligence
imposed on States to control pollution of the marine environment, require, at the
minimum, a case-by-case environmental impact assessment of the disposal, and
studies on the dumping site characteristics, alternative land-based methods of
treatment, and of the impact on other uses of the sea. These rules apply irrespective
20
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
of the maritime zone where the subsea structure is located– whether in the
territorial sea, the EEZ, or in archipelagic waters.
The concerns of environmentalists and how to avoid requalification as ‘waste’
89. Concerns are being expressed by environmentalists that rigs-to-reefs placement
might be abused by oil companies as disguised dumping. The IMO-UNEP 2009
Guidelines for the Placement of Artificial Reefs provide examples of legitimate use of
artificial reefs in an attempt to prevent the circumvention of the dumping rules.
Although they are merely soft law (and therefore not mandatory), they serve to
illustrate the sort of measures that can be adopted by States in order to ensure that
artificial reefs have a legitimate purpose and are consistent with the 1972 London
Convention.
90. In practice, this means that to avoid fictitious artificial reefs forbidden under
international law, States must adopt rigorous and scientific methods of assessing
artificial reef purposes, including detailed planning prior to deployment of the reef
(including Environmental Impact Assessments or EIAs), regular monitoring to verify
that the goals are met and iterative and adaptive management of the artificial reef
accordingly.
Practice in the Gulf of Mexico
91. The five states bordering the Gulf of Mexico – Alabama, Texas, Louisiana, Florida,
and Mississippi - all have active artificial reef programmes. Given the large number
of offshore platforms (around 3500, 85% of which are in less than 60m depth), Texas
and Louisiana rely most on these structures as building material for artificial reefs.
The conversion of abandoned and disused offshore installations into artificial reefs
has recently also been provided for by legislation in the State of California.
92. US federal law requires that offshore installations be decommissioned within one
year of termination of the lease, which means that the installation has to be
removed or put to another approved use, such as reefing.
93. The reuse of a rig as an artificial reef is allowed by the 1984 U.S. National Fishing
Enactment Act (NFEA) to ‘promote and facilitate responsible and effective efforts to
establish artificial reefs constructed or placed for the purpose of enhancing fishery
resources and commercial and recreational opportunities’. The subsequent National
Artificial Reef Plan also encourages state and federal partnership for operators to
donate decommissioned offshore platforms to coastal States to serve as artificial
reefs, and to ultimately serve as a guide for such programmes.
94. The Federal Plan sets out the roles of the various levels of government, federal
agencies and private actors. The Bureau of Safety and Environmental Enforcement
(BSEE) is not involved in any program to create artificial reefs. It is responsible for
ensuring that when an operator is no longer producing oil and gas from a well, the
well is correctly decommissioned and structures that are affecting the environment
or impeding navigation or other uses of the sea are removed.
21
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
95. In this capacity, BSEE adopted a national ‘Rigs-to-Reefs policy’ that supports the
reuse of oil and gas structures for limited offshore artificial reef development if
approved by the appropriate agencies. Operators with platforms that are nonproductive can apply to the US Army Corps of Engineers and the appropriate States’
competent authority, and, if approved, may request BSEE approval to dispose of
their platform within the guidelines set forth by the appropriate organisations. A
Coastal and Marine Spatial Planning tool was also introduced by BSEE to enable
stakeholders to have a say in the development of the artificial reef programmes. This
is done by engaging affected local communities and commercial actors and giving
them input into the policy process.
96. At the state level, Louisiana, Texas, Mississippi and California enacted Rigs-to-Reefs
legislation. The reefing of offshore rigs is either done in situ or at a designated
location, including some Artificial Reef Planning Areas where several rigs are reefed
together to create a larger habitat. It had taken more than ten years for the
California legislation to pass, following the failure of two previously defeated bills.
97. Yet, a collective social view remains that decommissioning, which involves leaving
parts of the rig in the ocean, constitutes ‘dumping’. A recent and mediatised
publication on the Gulf of Mexico ‘Bring back the Gulf’ also exemplifies the difficulty
to strike a balance between different interests at stake. This paper argues that with
rigs-to-reefs representing 5% of marine habitats in the Gulf of Mexico, and given the
many environmental stresses faced by marine life in the Gulf, it is time to review the
policy to ensure the ecological integrity of the programmes.
98. Some suggest that the most effective way to discharge the burden of proof by the
operator that the rig-to-reef project is beneficial overall is to employ a cost-benefit
analysis. The extent of benefits and costs that are required to be shown however is
unclear. Furthermore, the impact of the demonstration by environmentalists
throughout the entire Brent Spar episode (against the deep sea disposal of the Brent
Spar facility) shows that public perception and reputation are also important
parameters that need to be taken into account although they may be difficult to
quantify.
3. The Legal Regime of Artificial Reefs Depends on their Location and Purpose
99. The extent of a coastal State’s obligation of due regard for the rights of other States
and other users of the sea when removing and placing an artificial reef would
depend on the maritime zone in which the offshore installation is located, whether
in the territorial sea, archipelagic waters, EEZ, or the extended continental shelf.
100. Given coastal States’ sovereignty over their territorial sea, other States have only a
right of innocent passage in this zone. The coastal State is entitled to deploy artificial
reefs anywhere in this zone, provided that they are appropriately signaled as
required by the IMO’s navigation rules. The only limit to this right of the coastal
State is the requirement set in the 1972 London Convention that these artificial reefs
be legitimate and not a disguised illegal disposal (for which a permit and a different
22
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
process apply). Similar rules apply in archipelagic sea lanes of passage (through
archipelagic waters) where artificial reefs would not be acceptable, unless at great
depth, so as to not interfere with navigation.
101. By contrast, coastal States only have sovereign rights to the resources of the EEZ and
extended continental shelf. Other States enjoy the freedom of the high sea,
including the freedom of navigation and the freedom to lay submarine cables.
Therefore in these zones, in addition to being for a legitimate use, rigs-to-reefs
programmes must not interfere with these freedoms.
102. With respect to the rules that apply to the deployment, monitoring and maintenance
of the artificial reef, they depend on the intended purpose of the reef. If the purpose
of the artificial reef is the enhancement of fisheries yield or wild capture fisheries
management, internal and domestic fisheries regulations will apply. International
law grants coastal States sovereign rights over fisheries resources located in their
EEZ; however, it also requires that they do not exploit beyond the sustainable yield
of these fisheries. To be consistent with this, artificial reefs used for fisheries must
also be subject to effective fisheries management measures to avoid overfishing.
103. As for artificial reefs placed for marine tourism, or aquaculture, they qualify as
commercial activities and as such fall also within the exclusive jurisdiction of the
coastal States when they are located in the territorial sea or EEZ. By contrast, if it is
clear that coastal States are entitled to place artificial reefs solely for marine
conservation (including biodiversity) in the EEZ, their authority to legislate against
activities exercised by other States around and over the artificial reef is more limited.
They must respect the rights of other States. Notably, they arguably do not have the
authority to unilaterally limit navigation in this zone. They would have to seek the
prior authorisation of the IMO to adopt and enforce measures, such as routeing
measures or areas to be avoided either directly or through Particularly Sensitive Sea
Areas (PSSAs).
4. Transfer of Authority and Residual Liability
Institutional organisation
104. Depending on the purpose of the reef and the commercial or conservation activities
it is designed to serve, the supervising authority in charge of this activity and the
legal regime applicable will vary accordingly.
105. When an offshore oil installation is reused for a new purpose, an administrative
transfer of authority needs to occur for the relevant parts of the installation that are
being reused, from the authority in charge of offshore activities (such as the ministry
of energy or of mineral resources) to the ministry in charge of the new activity, being
the relevant department of fisheries, local authority for marine tourism or
otherwise.
106. Part of the responsibilities of the new authority in charge includes supervision, if not
direct maintenance of the rig and monitoring of the new use and, in coordination
23
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
with the authority in charge of granting permits for disposal at sea, to ensure that
the new artificial reef continues to fulfil a ‘legitimate’ purpose. However, the extent
of the transfer of liability for hazards created by the new artificial reef (if it was to
move and damage a submarine cable for instance) depends on the liability regime
under the coastal States’ national legislation.
Residual liability
107. In this context, residual liability simply refers to liability for any ‘residue’ that is left
behind after the termination of the agreement, and would depend on the specific
regional or commercial arrangement as well as the provision of the domestic law of
the State having jurisdiction. The transfer of ownership of an installation or pipeline
may or may not entail the transfer of liability to the new owner. The OSPAR
Convention provides that any residual liability remains the owner’s in perpetuity.
The UK regime also provides that persons who own an offshore installation or
pipeline at the time of its decommissioning will remain the owners of any residues in
perpetuity.
108. The reason for these continuing obligations is that coastal States have continuing
obligations that they try to limit by transferring them to other parties, where they
can. These obligations with respect to disused or abandoned installations and
structures located in its territorial sea or continental shelf include primarily the
obligation not to (i) endanger safety of navigation, (ii) interfere with the freedom of
laying submarine pipelines and cables or (iii) pollute the marine environment. These
obligations entail a duty of due diligence by coastal States that include the obligation
to prevent structural failure and to monitor the condition of the remaining structure
as well as the obligation to warn of dangers to navigation on navigational charts and
by signals.
109. In most situations, oil companies are liable for the plugging and sealing of wells at
the end of exploitation and decommissioning offshore installations, which are
connected to them. The liability for sealing the wells follows specific rules that are
distinct for those that apply to the structure. Liability for the structure is normally
discontinued once it is removed and disposed of on land (especially if no debris is
left behind).
110. However, the situation is different for sections of offshore installations that remain
on the seabed, whether in the same location or elsewhere. The question of liability
on these parts is of significant concern to oil and gas companies as they need to
assess their risk exposure. The importance of this question is also highlighted in the
1989 IMO Guidelines and Standards that state that Coastal States should ensure that
it is clearly established who retains the legal title and the responsibility for
maintenance of the installation as well as liability for future damages. However, it
does not provide a framework for determining who will have residual liability.
111. Liability in respect of some of the components of the structure may be released, but
not all. Liability for jacket removal for example can be transferred to fisheries,
24
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
tourism, or conservation authorities. However, costs and liabilities before, during
and after the process tend to be negotiated between operators and governments.
Whist this process is relatively smooth in the Gulf of Mexico where hundreds of
offshore installations have been reused as reefs, it is more difficult in Southeast Asia
where there are presently no established rules and practices and few examples of
rigs-to-reefs conversions.
Example of the Gulf of Mexico
112. In the US, the transfer from the National Authority in charge to the local authority
follows strict conditions set out in the National Artificial Reef Plan. It provides that
sole control and responsibility for the proper placement of the artificial reef at a site
lies with the operator. Title and liability transfer to the State occurs once it is
satisfied that all conditions have been met, following which the operator is released
of his obligations or duties for maintenance, repair or any other legal requirement
relating to the offshore structure (the well follows a different regime where the
ownership and maintenance of the well remains with the operator).
113. To work through this process, States locate and work with willing operators to
donate the decommissioned rig and seek the required federal permits from the US
Army Corps of Engineers, the US Coast Guard and the BSEE. Of note is also the
donation generally expected of the operator of 50% of the savings associated with
reefing for use by the State for maintenance and conservation.
Baram-8 case study
114. The Department of Marine Fisheries, Sarawak has assumed liability for the new reef
site that was created by toppling the Baram-8 rig. Liability was transferred after a sixmonth interim period, during which the operator was obliged to monitor the
surrounding environment. Of note is also the fact that the Department of Marine
Fisheries organised many meetings with the local community prior to deploying the
artificial reef in order to ensure optimum placement and support from them.
115. Similarly, in Thailand, the placement of an artificial reef requires a public hearing or
local meeting involving the fishing community before any decision on the design and
location. Approvals of the Thai navy and the Harbour Department are also needed to
ensure that the placement does not interfere with navigation.
5. Fisheries Management Measures: Compliance/Enforcement Issues
116. Based on coastal States exclusive jurisdiction on fisheries resources, they have full
jurisdiction to legislate and enforce fisheries management measures adopted for
artificial reefs located on their continental shelf.
117. In the Gulf of Mexico, where most offshore artificial reefs are used for fisheries
enhancement, fisheries control is exercised through species-specific licences and
quota systems enforced through the relevant fisheries authority. These licences do
25
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
not regulate specific artificial reefs or areas; they apply to fisheries for the relevant
species in the water falling within the jurisdiction of the fisheries authority of the
relevant State. Such fisheries management measures seem to be preferred to
Marine Protected Areas within the Gulf of Mexico.
6. Impact on Endangered Species Living on or around a Disused Platform
118. Some studies, as well as commercial divers, report that operating offshore
installations are frequently covered and surrounded by diverse marine life. In
assessing a proposal to dispose of a rig whether at sea or through its reuse in a rigsto-reefs programme, it is relevant to consider if any of the species found on or
around an offshore installation are threatened or endangered under the Convention
on International Trade in Endangered Species of Wild Fauna and Flora (CITES). The
species concerned may be resident to the habitat created by the offshore installation
or an endangered migratory species temporarily using this habitat.
119. The use of explosives to sever the jacket from the piles, before toppling it on site or
elsewhere, or to cut part of the jacket off can be particularly damaging to
surrounding marine life. However, there seems to be no domestic legislation in
Southeast Asia on cutting methods. The decision regarding the cutting tool and
method is generally made by the operator based on a balance of costs against the
consequences of that decision, including the potential negative impact on
reputation.
120. Domestic legislation that protects endangered and threatened species may interfere
with the removal of installations that support endangered and threatened species,as
with any decision that would threaten the protected species. Many States appear to
have conflicting domestic policies and measures, which on the one hand prevent the
removal of endangered species, but on the other hand recommend full removal of
disused offshore structures. The extent to which the presence of endangered or
threatened species on an offshore installation that is due to retire would determine
or influence the decommissioning option is still unclear.
7. Status of Regional Rules
121. States of Southeast Asia do not have decommissioning rules or rigs-to-reefs policies
that are more detailed and restrictive than the international rules. The latter thus
provide the only regional legal framework. As mentioned above, the international
legal framework is primarily composed of the 1972 London Convention on dumping,
UNCLOSand the 1989 IMO Guidelines and Standards.
122. Soft law instruments also include the 2000 Specific Guidelines for assessment of
Platforms or other Man-made Structures at sea and the 2009 IMO-UNEP London
Convention and Protocol Guidelines for the Placement of Artificial Reefs.
26
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
123. In addition, the ASEAN Council on Petroleum (ASCOPE) has completed the ASCOPE
Decommissioning Guidelines for Oil and Gas Facilities (ADG) following a three-year
development period, but this has yet to be released to the general public. Experts
acknowledge that this is merely a starting point for the development of a sound
regulatory system, and there are hopes in the industry that such a regime, when it is
eventually established, will be more flexible than those in place in the North Atlantic.
124. This weak regional framework is reflected in domestic legislation and generates an
overall lack of legal clarity and regulatory security, which in turn creates an obstacle
to the development of a regional decommissioning market. In the context of rigs-toreefs, the main difficulty is that although most States have adopted artificial reefs
policies, there is no mechanism in place to allow for their use in the context of
decommissioning.
125. In Malaysia, Petronas has the ‘entire ownership in, and the exclusive rights, powers,
liberties and privileges’ for all onshore and offshore petroleum activities. Petronas
also owns all offshore assets and is thus accountable for upstream facilities
decommissioning responsibility, liability and its residual liability. However, offshore
decommissioning legislation is still in progress. The only applicable policy document
is Petronas Decommissioning Guidelines but it is not publicly available. Industry
experts indicate that the preference is that offshore installations be fully removed,
but that they may be partly or wholly left in place on a case-by-case basis. The
decision to remove and reef Baram-8 in a specific location was taken in this legal
environment and required extensive consultation of all stakeholders involved
(government and others). It therefore provides a very useful case study to develop
new regulation.
126. In Thailand, there is no clear obligation to remove disused offshore installations. The
1971 Petroleum Act solely obliges the operator to ‘take appropriate measures in
accordance with good petroleum industry practice to prevent pollution of any place
by oil, mud or any other substance’, without providing further details. Rigs-to-reefs
are not mentioned either. However, research has revealed a general increase in
demand for artificial reefs. Unfortunately, limited knowledge and a lack of sufficient
finances to monitor the reefs following their deployment hinder the further
development of future artificial reef programmes. Improvement in artificial reefs
programmes coupled with legal and institutional linkages with decommissioning
options will be necessary for rigs-to-reefs programmes to develop in Thailand.
127. In Indonesia, the domestic regulations that have been in place since 1974 provide for
an obligation of complete removal and disposal of offshore installations that are no
longer in use, consistent with international law prevailing at the time. The 2011
regulations, which give Technical Guidance of Decommissioning of Oil and Gas
Offshore Installations, set out the process of asset retirement, which starts under
the supervision of SKK Migas. Similar to the situation in Thailand and Malaysia,
Indonesia has numerous artificial reefs programmes managed by fisheries
authorities, tourist authorities or local communities. However, what is missing is a
27
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
legal and institutional link between these programmes and the decommissioning
rules, without which reefs-to-rigs programmes will struggle to develop.
128. Brunei Darussalam’s decommissioning policies include 2009 guidelines for
Decommissioning, Abandonment and Restoration of the Oil and Gas Industry Assets,
which are based on a holistic case-by-case analysis involving all relevant stakeholders
and follow closely the wording of the 1989 IMO Guidelines and Standards. They
include rigs-to-reefs as a decommissioning option requiring that the jacket be
removed and cleaned onshore.
8. Main Findings
Finding 1: Full removal of offshore platforms is not always required
129. International law does not require full removal of disused platforms in all
circumstances, but leaving an offshore structure in place after decommissioning is
generally difficult or prohibited under most domestic regulations in Southeast Asia.
Finding 2: International law allows the reuse of offshore installations as artificial
reefs
130. Reusing an offshore platform as an artificial reef is not prohibited under
international law, provided that it does not disguise an authorised disposal at sea, or
‘dumping’. States of Southeast Asia all have rigs-to-reefs programmes. However, the
possibility to leave a platform in place and refit it as an artificial reef is more
complex. Although this solution may be acceptable under international law in
suitable circumstances (outside usual sea lanes of navigation, in sufficient depth,
etc.), it may be difficult to put in place under current domestic regulations in
Southeast Asia, unless clearer exceptions to the obligation of removal are created.
Finding 3: A special authorization is required for the disposal at sea of offshore
installations
131. Disposal at sea requires a special authorisation and impact assessment as provided
in the 1972 London Convention. The latter sets global standards that are a required
minimum for all States in Southeast Asia, irrespective of whether they are a party to
the 1972 London Convention (because it is an obligation under UNCLOS).
Finding 4: Rigs-to-reefs requires a management plan and on-site monitoring
132. To avoid the perception that artificial reefs are deemed as waste, and to ensure the
soundness of an artificial reef programme, each deployment of an artificial reef must
be authorised on the basis of an artificial reef plan based on scientific evidence that
includes expected goals of the deployment and management responsibilities.
Monitoring of the site at regular intervals will also ensure that it aligns with the plan.
Finding 5: Success of artificial reefs programmes in the Gulf of Mexico
133. The ‘success’ of artificial reef programmes in the Gulf of Mexico can be attributed to
a clear rigs-to-reefs policy, driven by the oil and gas industry and by recreational
fishers (and commercial fishers to a lesser extent). These programmes rely on three
key elements:(i) an obligation to decommission offshore installations within a short
time period, an expensive burden for operators and potential savings to be made
through rigs-to-reefs; (ii) the value seen by recreational fishers in offshore steel
28
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
structures and the economic importance of this industry; and (iii) US federal and
state legislation that integrated artificial reefs programmes into decommissioning
solutions and determined legal and institutional transfer of responsibilities between
relevant agencies, as well as defining their respective roles and duties.
Finding 6: Existing criticisms of rigs-to-reefs programmes in the Gulf of Mexico
134. Rigs-to-reefs programmes in the Gulf of Mexico are not always seen as being
‘successful’ from a net ecological benefit perspective. Environmental voices have
challenged assumptions underlying rigs-to-reefs activities (which tend to be
dominated by industry interests) and have asked that the programmes be stopped
temporarily to maintain the natural seabed and review the ecological integrity of the
programmes.
Finding 7: Clear rules on institutional responsibilities
135. Clear rules on institutional responsibilities for decommissioning, disposal at sea and
deployment of artificial reefs and transfer of responsibilities during these processes
are generally lacking in Southeast Asia.
Finding 8: Need for legal certainty and transparency in decommissioning process
136. The lack of legal certainty and transparency in the process to be followed in order to
refit an offshore jacket as an artificial reef is creating a legal risk for offshore
operators, which may deter them from pursuing rigs-to-reefs conversion, evenin
circumstances where rigs-to-reefs may represent the optimal choice from a fisheries,
tourism, or ecological perspective.
Finding 9:Residual liability
137. In the context of rigs-to-reefs, the issue of residual liability is confined to the
offshore platform being used as an artificial reef. The terms of the transfer of this
responsibility may vary. However, there are ways to mitigate this risk, including
regular monitoring of the reef and of its structural integrity, which could be paired
with the ecological monitoring required.
Finding 10: Impact of the presence of threatened and endangered species
138. The impact of the presence of threatened or endangered species on an offshore
platform prior to its removal is unclear and requires further investigation.
V. SESSION 4: THE BUSINESS CASE
1. A Business Case Driven by Costs
139. Despite general difficulties with convincing key oil and gas operators and
decommissioning industry players in Southeast Asia to participate in the workshop
as presenters and share their perspectives, Petronas did agree to present on the
decommissioning work they have undertaken and send some participants; other
industry representatives came as participants. However, the views that were
represented on the business case for decommissioning require further investigation
in order to match the level of information provided on ecological aspects of rigs-toreefs and the law and policy issues they raise.
29
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
140. Industry discussions on decommissioning and potential opportunity of a reuse as
artificial reef are generally dominated by issues of cost and technology.
141. However, the Baram-8 case study shows that stakeholder consultation can influence
the outcome of decommissioning operations that included a rigs-to-reefs option.
Notably, they influenced the choice of the location for the reefing of the jacket.
142. From a cost perspective, the business case presented by decommissioning
operations, where the jacket can be left in place, is compelling given the savings on
removal costs. Presumably, this would still be the case even if in-location cleaning of
the jacket is required.
143. In a situation where the jacket has to be cut – whether as a whole or in part removed and subsequently placed on site, the business case based on cost would
most likely also be established thanks to the savings made from not having to
transport the platform to shore and scrap it. However, this will depend on the age
and structural integrity of the jacket, the time required to cut, remove and topple it,
the safety risks attached, and the potential benefits from resale of parts of the
jacket.
144. Conversely, this business case would become negative if the removed part has to be
moved a long way away from its initial location. Offshore vessels are mobilised on a
high rate based on time. The time required for the job is thus a critical component of
the pricing. A rule of thumb frequently used in the decommissioning industry is that
the maximum acceptable distance for the transportation of a platform to a reefing
site is 50 km. Beyond this distance, the deployment costs would in most cases
exceed the cost of transport to shore and subsequent scrapping.
145. Several participants questioned this 50 km rule of thumb, asking whether the
circumstances giving rise to the 50 km rule would apply to Southeast Asia, given that
the structures are generally quite small and located in shallow waters.
146. However, there is a trade-off between the opportunity to reuse a disused platform
as an artificial reef (which involves cleaning and monitoring costs as a minimum) and
the cost recovery that may be possible if the removed jacket can be sold for reuse or
recycling. Unlike in the Gulf of Mexico, this practice is still limited in Southeast Asia
where such a second hand market for offshore installations would need to be
developed.
147. The choice of a decommissioning solution involves the consideration of a very large
number of parameters and trade-offs which cannot be fully examined without a
decision model. One decision matrix proposed during the workshop was a multicriteria decision framework based on decision science and often used for
environmental decision-making. The framework designed for decommissioning
integrated 38 or more criteria organised in five categories: environmental, socioeconomic, health and safety and additional stakeholder concerns. For each option,
30
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
the same criteria can be ranked, which allows for a comparison between options to
inform the decision-making process.
148. Discussions with the oil and gas industry indicate that the use of decision
frameworks for decommissioning is increasing. However, the type and number of
criteria taken into consideration seems to vary greatly among operators, as does the
methodology used to compare different options across a range of relevant criteria.
2. Main Findings
Finding 1: Cost of moving an offshore installation before reefing it
149. A dominant idea in the decommissioning industry is that rigs-to-reefs is not a
financially viable option if the removed offshore platform has to be moved far before
being deployed or if it has to be brought to shore for cleaning prior to deployment as
an artificial reef.
Finding 2: Shallow vs. deep water offshore installations
150. Conversely, there is a stronger financial case for deeper platforms to be reused as
artificial reefs rather than shallow and close-to-shore platforms. However, the few
hundred platforms due to be retired or decommissioned in the region are generally
small. Some are relatively close to the coast (less than 50km), but many are not.
Finding 3: Lack of awareness of potential socio-economic benefits
151. There seems to be a general lack of understanding by oil and gas players of the
potential benefits of artificial reefs in the region from a socio-economic as well as an
ecological perspective. This suggests that there is an opportunity for training on the
benefits and detriments presented by such a solution.
Finding 4: No negative bias against artificial reefs in Southeast Asia
152. The general perception in this region is not negative towards artificial reefs. There
seems to be little if any cultural bias against such a concept, unlike the prevalent
perception in many developed western countries that environmental management
should tend to limit the human footprint and attempt to return the natural
environment to the pristine state it was in prior to human exploitation. Southeast
Asia is more open to man-made management solutions involving artificial
components to recreate the natural environment.
Finding 5: Holistic decision modelling needed
153. Due to the complexity and range of indirect costs of decommissioning and rigs-toreefs (such as corporate reputation), the business case is not limited to the
operational costs involved. A more holistic decision modelling approach would
optimise the decommissioning solution to be adopted by considering the
performance of decommissioning options across a range of criteria, not just cost.
The industry should make better use of decision models based on decision science.
31
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
VI. RECOMMENDATIONS
Recommendation 1: Develop a National Dialogue Across Industry, Government
and Academia
154. Develop a national and local dialogue between the offshore industry, the Ministry of
Energy, relevant fisheries authorities, marine tourism authorities and marine
conservation authorities focused on (1) education of costs, benefits and pitfalls of
rigs-to-reefs as a decommissioning solution; (2) the development of regional
solutions; and (3) the identification of suitable locations for community based rigsto-reefs projects as pilot case studies.
Recommendation 2: Leverage Existing Large Artificial Reefs Programme Knowledge
155. Leverage existing large artificial reefs programmes in the region to include obsolete
offshore infrastructure as a reef-building material.
156. To that effect:
Establish a knowledge-sharing platform on large artificial reefs across
Southeast Asia, including monitoring of marine life on and around offshore
platforms and rigs-to-reefs research. To initiate this, CIL will host on its website
a research page and bibliography on this topic that displays all the resources
provided by experts and different stakeholders;
Require that operators provide ecological baselines and marine life monitoring
for ecosystems living under and around offshore installations (including all
threatened and endangered species);
Develop research and analytical frameworks to assess region-specific and local
environmental benefits of rigs-to-reefs programmes;
Recommendation 3: Develop Clear Legal, Institutional and Administrative Rules
157. Develop clear legal, institutional and administrative rules to facilitate rigs-to-reefs as
a decommissioning solution. Brunei, Indonesia, Malaysia and Thailand all need legal
and institutional security on decommissioning rules and reefs-to-rigs programmes
for oil and gas operators to contemplate these solutions seriously and invest
research and development into them.
158. These regulations and measures must include:
- An obligation to remove disused offshore installations within a certain
timeframe;
- An exemption to the obligation of removal where offshore installations
present an overall net environmental benefit (including supporting
endangered or threatened species) and do not interfere with safety of
navigation or other users of the sea;
- An integration of rigs-to-reefs into the list of acceptable decommissioning
solutions under domestic law;
32
Prospects for Rigs-to-Reefs in Southeast Asia – 12/13 Nov 2013 Conference at NUS
Conference Report published by CIL on 30 March 2015
-
-
Regulations or administrative measures that ensure the transfer of
responsibility for the decommissioned installation to the new authority in
charge once it has been allocated to a new use. Discharge of ongoing
responsibility for the structure, including maintenance responsibility, is
essential for the offshore operator and a key condition for success of rigs-toreefs programmes;
Clear reefing rules, including adequate impact assessments and monitoring,
to avoid requalification as illegal ‘dumping’ at sea; and
Fisheries management measures and compliance mechanisms to protect the
new reefs from over-exploitation.
Recommendation 4: Improve the Cost-Benefit Assessment of Rigs-to-Reefs
159. Improve the assessment of overall costs and benefits of rigs-to-reefs. This includes
two key action items:
- Develop a community and stakeholder engagement framework in order to
fully understand the impacts and benefits of rigs-to-reefs in Southeast Asia.
Identification of relevant stakeholders should be done at different
geographical and administrative scales considering all potential stakeholders;
- Use holistic decision frameworks based on decision science to optimise the
choice of decommissioning solution, such as a multi-criteria decision
framework integrating relevant criteria (relating to environmental, socioeconomic, health and safety and additional stakeholder concerns).
33