Maersk Decom expects a quick entry into the growing market for decommissioning, especially in the North Sea and eventually in other markets.
The new company, which is a joint venture between Maersk Drilling and Maersk Supply Service, estimates that there will be assignments worth more than USD 50 billion over the next eight years in the North Sea alone.
"We expect to build a market share of 10 percent over the next two to five years," says CEO Lars Banke in an interview with ShippingWatch.
To achieve that goal, Maersk Decom has a tentative workforce, which will reach 15 full-time employees by the end of the year, and in the next couple of years it will grow to 25 and from that it will continuously scale up and down with project teams on different assignments. Besides that, both joint venture partners have injected USD 10 million into Maersk Decom, meaning that the budget at start-up is USD 20 million.
"From there, we are supposed to make it on our own," says Banke.
Can cover 80 percent of a decommissioning assignment
The market for decommissioning has been steadily growing over the past few years as more and more fields are being emptied and a number of rigs need to be pensioned off. In the North Sea alone, 400 fields are expected to shut down until 2026.
Maersk Decom is not the only company vying for the many assignments with accompanying big budgets. Competition in the field is fierce, but Maersk Decom believes it has two advantages over its competitors.
Today we can submit an offer on 80 percent of tasks in a decommissioning project and expect to reach 100 percent with time. It will be an advantage to the oil companies, which have so far had to divide the task of decommissioning on a number of providers of the various assignments.
"First of all we have a strong foundation in the form of our parent companies, which will give us access to high-quality assets, and we will also work with collaborative partners in order to fulfill different project needs," says Banke and continues:
"Furthermore, we are the supplier with the largest solution palette. Today we can submit an offer on 80 percent of tasks in a decommissioning project and expect to reach 100 percent with time. It will be an advantage to the oil companies, which have so far had to divide the task of decommissioning on a number of providers of the various assignments."
Maersk Decom's preliminary offer to clients is to be a project manager for decommissioning tasks and to be able to solve tasks by first closing old wells and then clean up after many years of searching for oil. For example by towing platforms away from fields and by removing other infrastructure.
Maersk Decom's clients are potentially all oil companies, which work or have worked in the North Sea. But many of the large oil companies have internal decommissioning departments, and Maersk Decom therefore expects to primarily work with the smaller and medium-sized enterprises.
The establishment of Maersk Decom was announced in April, and within the same month Ardent also announced a new consortium for decommissioning. Ardent is owned by Maersk and US-based Crowley. In addition to Ardent, Lloyd's Register and the Australian engineering company WorleyParsons are also part of the new consortium.
In that connection, ShippingWatch asked Claus V. Hemmingsen, CEO in Maersk Energy, whether it is a problem that two Maersk companies want to enter the same market. Hemmingsen rejected that by, among other things, referring to the fact that Ardent and Maersk will not seek out exactly the same tasks.
"We'd very much like to be active, so we don't see this as a problem," he told ShippingWatch in May.
He emphasized that there is room for more players in the market.
"This is a large area, and many players are needed in order to remove the infrastructure that we are, with Maersk Drilling and Maersk Supply Service, looking at in the North Sea. There will always be other players who will come on board such a contract. Some times it could be us, other times it will be other players. Even though we're big, we're not big enough to cover the entire market," said Hemmingsen.
English Edit: Ida Jacobsen