Offshore decommissioning a significant opportunity and challenge for Australian businesses

Offshore activities, including decommissioning, must be approved by the National Offshore Petroleum Safety Environment Management Authority (NOPSEMA) and involves lodging certain documents, including an environmental plan, well operation management plan and a safety case.

Florence Riviere, an expert in planning and environment law at Pinsent Masons, said: “The environmental plan is the most significant, and potentially problematic, of these.” 

"Most major decommissioning projects are expected to occur in the next two decades and will involve the dismantling, removal and disposal or recycling of topsides and jackets or other processing and storage facilities, mooring systems, flowlines and risers and infield and export pipelines, manifolds and other subsea infrastructure, umbilical cables which provide electrical, data, and hydraulics services across the subsea field, as well as plugging and abandoning wells,” she said.

“While there is an alternative to full removal, namely leaving certain equipment or infrastructure in situ or relocating it to other offshore locations, that option is only available where it provides an equal or better environmental outcome to full removal.”

Angus Frean, an energy and infrastructure specialist at Pinsent Masons, said: “It is important to appreciate that much of this infrastructure has been on the sea floor for decades and is covered in marine life.”  

“Removal is likely to be the most expensive option, but it does not always follow that it is the best outcome for the environment,” he said.

“In most cases, removal will have a significant impact on the marine life that has built up on and around that infrastructure.”

Frean said: “Offshore decommissioning campaigns are incredibly complex.”

“They involve lining up availability of highly specialised vessels, specialist subcontractors and equipment and port access while also navigating the logistical issues arising from the vast distances involved and work constraints arising from offshore conditions."

“Any disruption on a decommissioning campaign is likely to result in significant delays and, potentially, be very costly,” he said.

The infrastructure can also be hundreds of kilometres offshore, increasing the risk of bringing contaminants from those areas back and potentially harming the fragile Australian ecosystem.

By contrast, leaving equipment or infrastructure offshore requires consideration of the environmental impact that degradation of equipment and infrastructure can have over time.

Last year, the Basker Manta Gummy decommissioning project undertaken in the Gippsland basin, off the coast of Victoria, saw its estimated final cost increase from between A193m to A$198m to approximately A$240m to $280m due to late vessel arrival and other unexpected delays impacting progress.

The recent rise in legal challenges to NOPSEMA’s of environmental planning approvals - seemingly to hold NOPSEMA and operators to strict standards and to secure better environmental outcomes - may see operators and NOPSEMA both taking more conservative approach to decommissioning activities, according to Frean.

“It would be an opportunity missed if operators are effectively disincentivised from exploring innovative decommissioning solutions with potentially better environmental outcomes, because the increased risk of legal challenge makes them unfeasible,” he said.
Speaking at the recent D&A AUS 2025 conference, Riviere highlighted the challenges and opportunities that decommissioning activities in Australia represent.

Riviere said: “Research and data of environmental impacts in Australian waters is still in its infancy, but it is a constantly changing landscape, with an increased interest and awareness about the environmental impact of offshore projects, including because of an increase in offshore wind projects.”

“Environmental approvals for major offshore projects are likely to be under increasingly greater scrutiny, with further challenges to environmental approvals anticipated,” she said.

“It is essential that environmental plans and assessments, including consultation, are undertaken comprehensively and exhaustively, with an eye on recent legal and scientific developments.”