In world’s largest archipelago, rigs breathe life into tourism
Tourism trails only oil and gas, coal and a handful of other extractive industries as the largest source of revenues in Indonesia. The sector stands to receive a further boost under plans for a Gulf of Mexico-style rigs-to-reefs program described to DecomWorld.
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Two platforms are already being earmarked for reefing, according to Umi Muawanah, a lead researcher in the Ministry of Marine Affairs and Fisheries. Pertamina Hulu Energi’s 129.7-ton KLYB Jacket entered operation in the Java Sea in 1992, and may soon be towed 75 miles to Biawak Island, a designated conservation area at the mouth of Jakarta Bay. Chevron’s eight-well, 1,300-ton Attaka 1 platform off the shore of East Kalimantan is another potential candidate for reefing. The platform halted operations in 2002 and has undergone structural reinforcement projects in the past three years.
“We have already gone to inspect the physical condition of the rigs, and have also conducted a community consultation on the aspects around the rig,” said Muawanah, who previously worked as a researcher at the US National Fisheries and Habitat Program. The inspections were conducted with approval from the Ministry of Energy and Mineral Resources, which she said was “very open to a rigs-to-reefs program”.
Implementation is still “quite far” in the future due to a lack of financing, she acknowledged. A working group of representatives from the marine, energy and transport ministries is looking into the problem.
From production to adventure
Indonesia has experimented with rigs-to-reefs in the past, having planted 20 m³ of artificial reefs made of concrete and recycled tires off the coast of eastern Bali to serve as a conservation and tourism area. The structures attract more than 6,500 divers a year, earning about $2 million each year for the local economy. Another reef is currently being constructed in Pemuteran, Bali, from metal structures and electrolyzed as cathodes to form aragonite, a base for new reef formation.
“There is value in expanding the tourism market with artificial reefs and therefore enhancing the capacity to create wealth and livelihood,” said Ingeborg McNicoll, Senior Partner at Environmental Resources Management. “There must be a return on investment when it comes to disposal of jacket structures, and in Indonesia, it seems the only way to get that is to combine it with an existing activity such as tourism.”
Efforts have also been made in neighboring Malaysia to integrate the decommissioning market with the tourism industry – and not necessarily involving reefing. The Seaventures Dive Rig off Sipidan Island is a retired and refurbished, jack-up accommodation module that has offered guests an opportunity to experience living on a rig and scuba diving since it was decommissioned and transported there in the late 1990s.
A rigs-to-reefs project typically involves partial removal near the surface, towing of a decommissioned structure to a reef site or toppling of the structure.
The platforms attract encrusting organisms such as barnacles and bivalves which colonize on them and in, in turn, attract other marine life. The United States has approved more than 400 rigs-to-reef proposals since 1986, according to the Bureau of Safety and Environmental Enforcement.
The case for using this method to dispose of platforms in the United States and Asia is made stronger by a struggling steel-manufacturing sector. Steel coils currently sell for approximately $200/ton, a stark contrast from the US$700/ton prices seen in 2011. Demand for steel fell 2.8% between 2014 and 2015 leading to a decline in global capacity utilization from 73.4% in 2014 to 69.7%, according to the World Steel Association.
Global steel-capacity utilization has been gradually falling since 2014 (Source: World Steel Association)
“Typically steel mills need scrap to survive because it is cheaper material than using ores, but it is becoming less feasible to sort the scrap steel manually. The cost of tearing up a rig may outweigh the value of the scrap steel. The added labor cost and time isn’t worth it with these current prices,” said Ritesh Dugar, head of Intexport, a Hong Kong-based steel distributor.
Muawanah also acknowledged that a rigs-to-reef program would be more economic for operators and regulators than onshore cutting and storage of the structures.
Bonus for marine life
Supporters of reefing argue that the structures help protect marine life from industrial fishing techniques such as trawling. With Asian waters having been subjected to over-exploitation, rigs-to-reefs programs would be one way to enable regeneration of fish populations.
“Across the whole of Southeast Asia there is a heavy dependence on fishing for protein and there is a heavy over fishing element in all countries. All countries in Southeast Asia are overfishing their fish stocks,” McNicoll commented. “Indonesia is really pioneering sustainability in some ways by looking to redirect something like the fishing industry to something like the tourist industry.”
There is also evidence that artificial reefs can boost secondary production (measuring animal biomass growth over time) of the area surrounding the reef. According to a study by the US Bureau of Ocean Energy Management, annual secondary production is higher in reefed platforms than in naturally formed habitats. A large surface area of hard substrate provides a nursing ground for plankton, invertebrate and fish, supporting the development of a food web.
Emily Callahan, co-founder of Blue Latitudes and an expert on rigs-to-reefs in the US, said reefed platforms in California had enabled the development of some of the world’s most productive ecosystems.
“Particularly so because they replace much of the near-shore rocky-reef habitat that has been degraded due to both erosion and increased development,” she explained. “In fact much of the aqua-culture brood stock here in California is harvested from these platforms.”
By Lionel Mok