Offshore Decommissioning Market Report 2025

The offshore decommissioning market size has grown strongly in recent years. It will grow from $6.38 billion in 2024 to $6.94 billion in 2025 at a compound annual growth rate (CAGR) of 8.9%. The growth in the historic period can be attributed to the growing number of abandoned wells, the rising investments for the remediation of inactive oil and gas wells, and the increasing mature offshore oilfields.

The offshore decommissioning market size is expected to see strong growth in the next few years. It will grow to $9.51 billion in 2029 at a compound annual growth rate (CAGR) of 8.2%. The growth in the forecast period can be attributed to the surge in government funding for well decommissioning and abandonment programs, the increasing exploration and production activities for oil and gas, and the rising demand for crude oil products. Major trends in the forecast period include increasing emphasis on decommissioning contracts with industry leaders, expanding acquisition efforts to increase geographic presence, growing importance of topside removal projects, strategic partnerships and collaborations among market players, and innovations in subsea processing and transportation systems.

The forecast of 8.2% growth over the next five years indicates a slight reduction of 0.1% from the previous projection. This reduction is primarily due to the impact of tariffs between the US and other countries. This is likely to directly affect the US through increased costs for specialized cutting equipment from Norway and remotely operated vehicles (ROVs) from the UK, raising expenses for well plugging and platform removal projects. The effect will also be felt more widely due to reciprocal tariffs and the negative effect on the global economy and trade due to increased trade tensions and restrictions.

The offshore decommissioning market is poised for growth, driven by increasing government investment in well-plugging and abandonment activities. Well-plugging involves permanently sealing abandoned wells to prevent surface drainage contamination. Offshore decommissioning ensures the cessation of offshore oil and gas production, restoring the ocean and seafloor post-abandonment. Notably, the U.S. government plans to allocate $33 million for remediating oil and gas wells on federal property, with a focus on addressing abandoned wells as part of the bipartisan infrastructure package. This substantial government investment is a key factor propelling the growth of the offshore decommissioning market.

The growth of the offshore decommissioning market is further fueled by the rising demand for crude oil products. Increased demand for crude oil leads to expanded oil drilling activities, resulting in the establishment of more offshore oil and gas installations. As these installations approach the end of their productive life, the need for decommissioning services grows. In 2022, U.S. crude oil exports reached a record high of 3.6 million barrels per day, with Asia and Oceania accounting for 43% of these exports. This surge in crude oil demand contributes significantly to the demand for offshore decommissioning services, thereby driving market growth.

Strategic partnerships are a significant trend in the offshore decommissioning market, with major players collaborating to leverage each other's resources and maintain their market presence. For example, in February 2024, Sapura Energy, a Malaysia-based offshore contractor, partnered with AF Offshore Decom to address the increasing demand for offshore decommissioning in Southeast Asia by providing integrated services that range from engineering to waste disposal. Their joint venture, Kitar Solutions, merges Sapura's regional expertise with AF Offshore Decom's experience in dismantling and recycling oil and gas infrastructure, streamlining operations in the process. AF Offshore Decom is a US-based company specializing in offshore decommissioning.

The growth of the offshore decommissioning market during the historic period was driven by the increasing number of mature offshore oilfields. A mature oilfield is typically characterized by a significant decline in production rates or nearing its economic limit. It may also be considered mature after many years of production, during which its primary and secondary recovery methods have been exhausted. Mature fields, many of which are in secondary or tertiary production phases, account for over 70% of the world’s oil and gas production, making their development crucial to the global economy. For instance, according to the U.S. Energy Information Administration, in December 2021, U.S. oil production, which includes both crude oil and condensate, was 11.7 million barrels per day (b/d). By 2022, this figure had increased to 12.1 million b/d, reflecting a significant rise in production. Thus, the growing number of mature offshore oilfields has played a vital role in the expansion of the offshore decommissioning market.

In March 2022, Claxton, a UK-based leader in Acteon’s drilling and decommissioning segment, acquired decommissioning personnel and assets from Oceaneering International, a U.S.-based service provider in drilling and decommissioning of offshore oilfields. This strategic acquisition enhances Claxton's capabilities and decommissioning expertise, solidifying its position as a top international provider of offshore cutting services.

Major companies operating in the offshore decommissioning market include TechnipFMC PLC, Petrofac Limited, John Wood Group Plc, Aker Solutions ASA, Allseas Group SA,Equinor ASA, Schlumberger Ltd., Acteon Group Ltd, DNV GL, AF Gruppen ASA, Reliance Industries Limited, Cairn Oil and Gas, Essar Offshore Subsea Limited, Afcons Infrastructure Limited, Seamec Ltd, China Offshore Oil Engineering Corporation, Shanghai Salvage Company, China Oilfield Services Limited, Shanghai Zhenhua Heavy Industries Company, Boskalis Subsea Services, Augean North Sea Services, Veolia Environmental Services, ASCO Group, Gazprom, Rosneft, LUKOIL, NOVATEK, Sovcomflot, ExxonMobil Corporation, Baker Hughes Company, Halliburton Offshore Services Inc., Weatherford International PLC, Tetra Technologies Inc., Allnorth Consultants, Petrogas Group, R.J. MacIsaac Construction Ltd, Petrobras, OceanPact, Subsea 7, Ocyan, Oceaneering, Norwell Engineering, Aries Marine, Gulfstream Services, Decom Engineering, Environment Quality Services, the Sparrows Group, Southey Contracting, Sasol, Alduco Engineering Services.

Note that the outlook for this market is being affected by rapid changes in trade relations and tariffs globally. The report will be updated prior to delivery to reflect the latest status, including revised forecasts and quantified impact analysis. The report’s Recommendations and Conclusions sections will be updated to give strategies for entities dealing with the fast-moving international environment.

The sharp rise in U.S. tariffs and ensuing trade tensions in spring 2025 are heavily impacting the oil and gas industry, especially in areas such as exploration equipment, pipeline development, and refining operations. Increased import duties on drilling rigs, steel pipes, and specialized machinery have significantly raised capital expenditures across both upstream and downstream segments. Midstream players are grappling with cost surges for essential components like valves, compressors, and storage tanks, causing delays and disruptions in expansion projects. Refiners, meanwhile, are contending with higher expenses for imported catalysts and control systems critical to operational efficiency. In addition, retaliatory tariffs from major trade partners have curtailed U.S. exports of liquefied natural gas (LNG) and crude oil, reducing global competitiveness. In response, companies are ramping up investments in domestic manufacturing alliances, digital asset management tools, and diversified energy portfolios to maintain resilience and protect profitability.

Offshore decommissioning is the process of ceasing oil and gas operations on an offshore platform and restoring the seafloor and ocean to their pre-lease conditions.

The primary services involved in offshore decommissioning include project management, engineering and planning, platform preparation, well plugging and abandonment, conductor removal, platform removal, pipeline and power cable decommissioning, material disposal and site clearance, and other related services. Project management encompasses activities such as defining project objectives, establishing checkpoints, creating various scenarios, and developing contingency plans. Different structures, including topside, substructure, and subsea infrastructure, are utilized in various applications such as shallow water and deep water within the context of offshore decommissioning.

The offshore decommissioning market research report is one of a series of new reports that provides offshore decommissioning market statistics, including offshore decommissioning industry global market size, regional shares, competitors with an offshore decommissioning market share, detailed offshore decommissioning market segments, market trends and opportunities, and any further data you may need to thrive in the offshore decommissioning industry. This offshore decommissioning market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

Europe was the largest region in the offshore decommissioning market in 2024. The regions covered in the offshore decommissioning market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the offshore decommissioning market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Italy, Spain, Canada.

The offshore decommissioning market includes revenues earned by entities by structural tear-down, building material segregation, debris removal, and recycling, pressure washing, surface wipe-down, lead paint or asbestos abatement, storage tank removal, and other types. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.

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