Key facts
- Decommissioning spending in the UK North Sea reached a record £2.6 billion ($3.5 billion) in 2025.
- Well decommissioning constitutes about half of the projected costs for the UK Continental Shelf (UKCS) until 2032.
- There is a backlog of approximately 500 wells awaiting decommissioning and final abandonment.
- Operators spent £1.3 billion ($1.75 billion) on well decommissioning activity in the past year.
- Decommissioning expenditure is projected to surpass capital expenditure starting in 2029.
- UK Prime Minister Andy Burnham is expected to support new oil and gas projects.
Decommissioning spending in the UK North Sea reached a record high of £2.6 billion ($3.5 billion) in 2025, according to a report by the North Sea Transition Authority (NSTA). Well decommissioning remains the largest component of projected expenditure on the UK Continental Shelf (UKCS), accounting for approximately half of the expected costs through 2032.
The regulator noted that there is a backlog of about 500 wells awaiting decommissioning and final abandonment, urging operators to accelerate work on well closures. Last year, operators spent around £1.3 billion ($1.75 billion) solely on well decommissioning, with work completed on over 250 wells, and more than 100 reaching final abandonment.
With over 1,000 additional wells forecast for decommissioning in the next five years, activity levels must significantly increase to meet regulatory expectations and ensure supply chain resources. Nearly half of all UKCS decommissioning spending is anticipated by 2032, a period dubbed the 'decade of decommissioning'.
Decommissioning expenditure is forecast to exceed capital expenditure from 2029 onwards as the North Sea matures and fewer new oil and gas projects receive approval. In a potential boost for the industry, new UK Prime Minister Andy Burnham is expected to support some new projects, contrasting with his predecessor's stance on banning new drilling.