Millions of pounds of extra funding has been announced to help maximise the economic benefit to Scotland from the decommissioning of North Sea oil and gas infrastructure. 

Ministers said an additional £4 million had been made available in the latest phase of the Decommissioning Challenge Fund (DCF). 

It comes after £10m was committed in the first three rounds of the fund, pumping money into locations including Shetland, Kishorn, Aberdeen, Dundee, Leith and Hunterston.

The cash aims to provide support for projects to boost the burgeoning decommissioning market in Scotland.

Energy minister Paul Wheelhouse said decommissioning offered “significant economic opportunities”.

He said: “Industry reports tell us that £15.3 billion is forecast to be spent in the UKCS between 2018-2027, with further market demand beyond this. 

“This represents a great opportunity for Scotland’s supply chain and I am delighted to announce this £4m fund.

“Scotland’s energy strategy highlights the significant economic opportunities that decommissioning offers, and commits to enhancing our skills
and capacity. 

“As the industry continues to build on established capabilities and internationally recognised expertise, such as in well plugging and abandonment techniques, the fund plays a crucial role in supporting the future development of this growing industry.

“Decommissioning North Sea infrastructure will help Scotland’s supply chain gain an even higher share of North Sea projects and capitalise global market opportunities by exporting knowledge and experience. 

“This fund will support innovation in the supply chain, further cost reduction and improve the recognised skills of the Scottish workforce – which is why it has proved so popular with businesses.”

Decommissioning refers to the dismantling and removal of oil and gas infrastructure after production ceases, and the worldwide market is expected to be worth more than $80bn (£64bn) over the next decade. Industry figures insist this represents a crucial opportunity for supply chain companies and technology developers to meet demand.

There are more than 1,465 wells and around 880,000 tonnes of platforms due to be disposed of, reused or recycled over the next decade in the UK, at a cost of around £15bn.

In the 2018 Budget, Chancellor Philip Hammond announced a call for evidence on plans to make Scotland a global hub for decommissioning.

The UK Government has argued Scotland will “pioneer the future of the global oil and gas industry”, with the North Sea representing “one of the first regions in the world to start decommissioning on such a large scale” .

This provides opportunities for innovation, while the challenging environment in the North Sea is also seen as an advantage in refining techniques.

Earlier this year, a report by Westminster’s Scottish Affairs Committee said: “Decommissioning represents a significant export opportunity for Scottish businesses. 

“Scotland has the opportunity to become a global base for the decommissioning industry.”

Mike Tholen, upstream policy director at Oil and Gas UK, said decommissioning is a growing market of which Britain is well-placed to take advantage.

He said: “The Decommissioning Challenge Fund underlines the Scottish Government’s ongoing commitment to the oil and gas industry as we look to harness decommissioning opportunities at home and indeed, globally. 

“Although decommissioning only accounts for 8 per cent of total spend in the North Sea, it is a growing market in which the UK has first-mover advantage. 

“This will not only provide the supply chain with a steady workflow in the UK, but these competitive capabilities are exportable to a global market. 

“At the same time, we remain focused on providing security of energy supply through home-produced resources, providing energy sovereignty as recognised recently by the Committee on Climate Change in its net zero report. 

“All of this will ensure that we continue to provide highly skilled jobs, remain a major economic contributor and are best placed to become a key partner in the transition towards a low carbon future.”

Some environmental campaigners have advocated a “rigs to reefs” approach which would see oil and gas infrastructure left in place rather than removed at the end of its lifespan. 

This would allow subsea structures to act as artificial reefs, providing a refuge for a wide variety of marine life. 

A spokesman for the Scottish Wildlife Trust said: “Decommissioning of oil rigs, even if carried out sensitively, will cause some disturbance to the marine environment. 

“The alternative to removal is leaving the structure in place, which may seem like abandonment but there can actually be ecological benefits to leaving oil rigs in place because marine life tends to gather around large objects such as
the legs of oil rigs, using them as
artificial reefs. 

“Importantly, the decision on what to do with a particular structure should be taken on a case-by-case basis and must be informed by a detailed environmental assessment.”

However, Greenpeace has previously insisted “the best way to ‘help’ marine ecosystems is to restore them to as natural a state as possible once a structure is no longer in use”. 

Mary Church, head of campaigns at Friends of the Earth Scotland, said: “It’s good news that further money has been made available to the Decommissioning Challenge Fund, as supporting supply chain innovation is vitally important in creating decent jobs here in Scotland as we move to a zero carbon economy.

“We would urge the Scottish Government, however, to take forward initiatives like this under a broader framework ... that is accountable to the workforce, and safeguards jobs and workers’ rights while meeting climate targets.”