Decommissioning in the Bass Strait

The process of decommissioning offshore facilities presents complex challenges. As operator of some of Australia’s oldest oil and gas fields, Esso Australia is committed to decommissioning our Bass Strait offshore facilities safely and effectively.

We have substantial experience in safely and effectively decommissioning facilities to achieve positive outcomes across the globe, and we are excited to be part of Australia’s growing decommissioning industry.

Just like all oil and gas industry activities, decommissioning is highly regulated with complex and robust regulatory approval processes involving a number of federal, state and local government bodies and independent regulators.

As we continue to plan for decommissioning our non-producing facilities, we are working with relevant stakeholders to find solutions that balance environmental outcomes with the needs of the community, and regulatory requirements.

Our ongoing role in the Gippsland Basin

Esso Australia has been a proud member of the Gippsland community for more than 50 years. During that time, we have delivered highly skilled jobs and business opportunities to the region and created significant, long-lasting economic benefits.

The Gippsland Basin remains today the largest single source of gas supply to the east coast domestic market, and has the potential to continue supplying one third of south east Australia’s domestic gas demand through to the end of this decade.

Our offshore and onshore operating network spans over 300 kilometres, including a mix of 19 producing and non-producing offshore facilities and associated pipelines, along with our Longford gas plants and Long Island Point plant. We will begin to remove the offshore facilities that are no longer producing oil or gas while seven of the offshore facilities will continue to supply essential energy to the Australian domestic market through to the 2030s. This means that we need to remove our facilities in stages, with preparations for the first stage, which we call Campaign 1, already well underway.

We will continue to provide local employment opportunities across our producing facilities for years to come. In addition, we are and will continue to utilise a skilled workforce to undertake the challenging and extensive work involved in decommissioning our non-producing offshore facilities.

Historically, Esso has employed between 300-500 staff working on its offshore oil and gas platforms. However, since decommissioning has started, there are now over 800 people employed offshore, and an additional 50-100 jobs expected to be created onshore. The onshore workforce required to execute the dismantling and recycling of the platforms at Barry Beach Marine Terminal is expected to come largely from Gippsland, enhancing skill development in this growing part of the industry.

Completing decommissioning includes a significant scope of work throughout the decommissioning phases, including, but not limited to, well sealing, maintenance, care and preservation, preparation for removal, topside removal and subsea facility decommissioning.

We’re making significant progress as we prepare to remove our offshore facilities

Over the last few years, we have completed over $3 billion of decommissioning works in Bass Strait, including permanently sealing more than 220 wells. 

We have sourced the right vessels to complete the work safely and efficiently, commissioning over seven mobile offshore assets, including the Skandi Darwin Multi-Purpose Support Vessel, Helix Q7000 semi-submersible, VALARIS 107 jack-up rig and platform based rigs; Rig 22, Rig 47, Rig 48 and the HWT600. We have successfully removed the Seahorse and Tarwhine subsea facilities, and permanently and safely sealed all wells in the Blackback, Kingfish, Mackerel, Flounder, Fortescue, Bream and Whiting fields.

The different types of facilities

Esso Australia’s facilities in the Bass Strait include 19 platforms that consist of three types: steel piled jackets, concrete gravity structures, and monotowers.

An overview of the decommissioning process

Cessation of Production

The Cessation of Production stage begins when a facility no longer produces oil and/or gas, or pipelines no longer transport oil and/or gas to shore or supply other facilities with resources. During this stage, oil and gas production wells are permanently sealed, and the facility is maintained in a safe state.

Stasis Mode

When a facility or pipeline reaches Stasis Mode, it has officially retired and is ready for decommissioning. Regular platform visits allow us to inspect the facility and conduct any required maintenance, to maintain the platform ahead of decommissioning. Our facilities will continue to progressively reach stasis mode until we begin to remove the first 12 in 2027.

Removal Activities

Specialty third party contractors will be used for removal activities to achieve the agreed end state of facilities. This includes the use of appropriate vessels, equipment and expertise to complete this work during decommissioning campaigns.

Surrender of Titles

Following completion of Removal Activities and in agreement with the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA), the Titleholders will apply to the National Offshore Petroleum Titles Administrator to surrender the relevant petroleum titles.

Preparing for facility removal

Esso Australia has made significant progress to permanently seal wells at our non-producing platforms, ensuring they remain in a safe state until final decommissioning occurs.

The permanent sealing of wells involves using specialised equipment to install cement plugs at specified depths to a minimum height of a 20-storey building.  The cement plugs are pressure tested to more than 10 times the pressure of a standard car tyre to ensure the cement has the integrity required to act as a permanent barrier. These activities are conducted with oversight from our federal offshore regulator under an approved Well Operations Management Plan. 

Decommissioning Campaign #1

Planning for Campaign #1, the first of the decommissioning campaigns, is progressing. Campaign #1 covers all 12 facilities that have reached the end of their production life and includes:

• Removal of the topsides and jackets of offshore platforms to as close as practicable to the ocean floor, to a maximum of 3 metres above the seabed
• For seven platforms in deeper water (Cobia, Flounder, Kingfish A, Kingfish B, Mackerel, Fortescue and West Kingfish), we are intending to remove the topsides and upper jacket sections to at least 55 metres below mean sea level, as part of campaign 1. We will continue to assess removal of the lower sections as part of a future campaign.
• Removal of the topsides of the Bream B platform, which is a concrete gravity structure
• Removal of two monotower platforms (Dolphin and Perch).

The Decommissioning Planning team continues to undertake technical studies to progress planning for future decommissioning activities in Bass Strait following Campaign #1. In 2024 these included:

• Assessing methods to remove pipelines and umbilicals in Bass Strait
• Assessing the feasibility of options to remove the two concrete gravity structures (Bream B and West Tuna).
• Early preparation and planning for Campaign #2 which would involve decommissioning of the remaining platforms in Bass Strait once they are no longer producing gas.

The removal process

Campaign 1 will utilise the Pioneering Spirit, the world’s largest and most advanced offshore construction vessel, marking its first-ever deployment in Australian waters.

The Pioneering Spirit is a game-changer in offshore engineering. At nearly 400 metres long and 124 metres wide, it is purpose-built to install and remove entire offshore platforms in a single lift. Its single-lift technology allows the removal of topsides weighing up to 40,000 tonnes and jackets up to 20,000 tonnes, reducing offshore risks and environmental impacts. By transferring complex dismantling activities onshore, this approach improves safety and efficiency.

The vessel also boasts unmatched pipelay capacity, advanced motion-compensated lift systems, and precision positioning enabled by 12 azimuth thrusters. These features make it one of the most capable and versatile vessels in the world.

Once removed, the structures will be transferred to barges and transported to Barry Beach Marine Terminal, where they will be dismantled and recycled on impermeable barriers consistent with international best practice. This process ensures safe handling and maximises material recovery.

All dismantling activities will be completed responsibly in full compliance with environmental regulations and in a timely manner. Around 100 jobs are expected to be created with preparing for and executing onshore recycling activities.

We are excited to utilise Barry Beach Marine Terminal for our decommissioning activities to continue to provide further employment opportunities and economic benefits across the region, as we have done for many years now. Many of our facilities were fabricated at Barry Beach Marine Terminal and we’re pleased to provide a full cradle to grave story for these facilities, which have helped power the Australian east coast for over 50 years.

The disposal process

The contract for dismantling, recycling and waste management has been awarded to the Gippsland-based company, CMA Contracting, a part of the Delta Group.

We plan to maximise recycling of the facilities for a second life, and minimise the amount of materials processed as waste, with an aim that more than 95% of the mostly steel material will be able to be recycled or reused from our oil and gas structures. Most of the steel will either be sent offsite in trucks, or via ship for onward transportation to recycling facilities.

Community engagement

From the outset, we identified and actively engaged with key stakeholders across the Gippsland region and continue to consult them as we progress the project and consider other future work related to decommissioning. This ongoing communication has played an essential role in how we align our approach and ensure the work that we are undertaking meets the community’s needs and expectations.

Please visit our Consultation Hub, or reach out to our Consultation team at consultation@exxonmobil.com if you would like to learn more about decommissioning or our other projects.

Opportunities for the Gippsand Basin

Although the Gippsland Basin has been producing energy for more than 50 years, it remains today the largest single source of gas supply to the east coast domestic market.

The Gippsland Basin has the potential to continue supplying one third of south east Australia’s domestic gas demand through to the end of this decade. Our transition to a modern Australian gas business and the eventual decommissioning of our facilities are significant challenges that will provide local employment opportunities and contribute to the Gippsland economy for many years to come.

While we are currently undertaking activities to decommission our non-producing facilities, there will be further decommissioning works required in future, including the eventual decommissioning of facilities that today are still delivering much-needed gas to Australia.

Our offshore and onshore operating network spans over 300 kilometres across south east Australia, and includes 11 producing offshore platforms and installations which will continue to operate in the Bass Strait as we commence this initial phase of the decommissioning process, providing essential energy through the Longford and Long Island Point Plants.

We are actively working with multiple parties to ensure these valuable assets continue to be an important part of south-east Australia’s energy system and support Australia’s medium to long-term emissions reduction goals.