Interview: VP Decommissioning Repsol-Sinopec Joins Reuters Events flagship Decommissioning Summit

Over the coming weeks, I'll be releasing quick-fire interviews with some of our 2020 speaker faculty, as part of the DecomWorld by Reuters Events Speaker Soundbites Series. You can check out the full speaker line up here. Alvaro heads up decommissioning at Repsol-Sinopec and will be sharing insights on our keynote panel session, Decommissioning on Six Continents. I sat down with Alvaro recently to hear more about his role and his thoughts on global decommissioning developments.

Hi Alvaro. We’re super excited to announce you as part of our speaker faculty for the first time in 2020. What is your current focus at Repsol-Sinopec, and how does this fit into the work you’re doing with Repsol?

Our focus at Repsol Sinopec is safe and efficient project delivery and building a sustainable decommissioning strategy for our portfolio of assets. From a Repsol perspective we are looking to see how we can transfer the learnings we have had in the UK and Norway to the wider asset base of Repsol worldwide and build a clear decommissioning strategy.

Ok, that’s interesting. So to what extent can learnings from more mature decommissioning markets like the North Sea be used within decommissioning regions with less experience?

This is very applicable, and this is an area we are working to develop within our company. The knowledge sharing of lessons learnt, contracting strategies, technology, collaboration with others, etc., is transferrable but we need to develop the network of information to do so.

Well it sounds like you’re doing some interesting stuff to that regard. Within that, what do you see as the biggest challenge facing the offshore decommissioning industry over the coming decade, and what are you doing to address this?

I would say there are 3 main challenges we are facing. One is the maturity of decommissioning supply chain and the commercial innovation that is required for decommissioning. Second, the maturity of the technologies, both in well P&A and facilities, that is necessary to reduce our decommissioning costs in the future. And third, the challenge associated to changing the mindset from E&P to decommissioning in all elements of the chain… supply chain, operators, regulators… in order to capture all the potential value associated to decom activities for all parties involved, including supply chain, operator and tax payer. If these things don’t take place we will be in a difficult position to deliver the necessary value in the execution of our activities.

To what extent do regulations drive your decom activity, or are other factors more influential to CoP?

It’s a combination of regulation and late life asset management. We have a clear strategy as a company to decommissioning our assets safely within the regulatory framework and working closely with the regulators is key to make sure we are doing the right thing. We need to develop our decommissioning plans for each asset 3 to 5 years before CoP, and if we do so, we will be ready to decom our assets efficiently once CoP is reached.

It looks like you’re doing some amazing work in late-life asset management – how does this fit into your strategy?

Late life asset management is a key focus area within our strategy. We need to make sure that we develop a glide path of cost reduction prior to CoP, so the day we hit CoP we can quickly ramp down our Post CoP running costs. Within the UK portfolio approximately 10% of our Decom Liabilities are Post CoP running costs so it is critical that we continuously review this to improve further our cost base.

Are you exploring the potential for platform reuse or repurposing?

Whenever we do the Decommissioning Program for each asset we make sure we consider platform reuse or repurposing. One of the Repsol Norway platforms is currently being assessed for reuse and if this materializes this will provide a great benefit to the economics of a new development.

I know that’s our six questions up, but I also wanted to ask what new decommissioning and P&A technology you think would be a gamechanger when optimizing efficiencies?

50% of our decom costs are in Well P&A, thus rigless solutions to P&A the wells has the potential to cut our costs up to 50% or more. Thus, plugging technologies that can be deployed through rigless solutions will be one of the biggest unlockers of value.

Indeed, rigless does seem a key enabler. As I said, we’re hugely excited to announce you as part of our speaker faculty for the first time in 2020, but why have you chosen to speak at DecomWorld?

It’s a great opportunity to share some of the challenges we are facing and get some constructive discussions around what we can do as an industry to address them. The work we have done in the UKCS over the past 4 years has given us great results and learnings and being able to share this with a global audience will not only benefit others but also will allow us to learn from what others are doing. I see decommissioning as a non-competitive environment for all stakeholders, thus we need to do more to share and learn from each other. We all have the same goal: deliver our decommissioning projects safely and at the best value. Any cost reductions we can do in our Decommissioning Projects will allow us to invest more in development projects.

Thanks Alvaro. We look forward to seeing you and your team in Houston next year! 

This interview was conducted by Owen Rolt, Global Project Director at DecomWorld, by Reuters Events and in collaboration with the 12th Annual Decommissioning and Abandonment Summit 2020.

For more information around the event or if you’d like to get involved feel free to drop me an email or give me a call. 

I hope you enjoy reading this insight - please let me know if you have any feedback.