After the discoveries in the Gulf of Mexico in the 1970s, cathodic protection systems were adapted for standalone reef cultivation at various sites around the world. Two of the largest such reefs have been alive and well in Indonesia since 2007.
Today, we know we can grow reefs faster than we are killing them off, largely because of the knowledge base from California and the Gulf of Mexico.
We also know that rigs-to-reefs programs are replicable – if governments want them (and some allegedly well-informed governments don’t).
However, not all rigs are suitable for conversion. The conversion rate in the US has been around 11%, although that figure might be much higher in Southeast Asia.
Based on the US conversion rates, there are at least 150-200 rigs-to-reefs candidates in Asia and the Pacific, mostly in Indonesia, Thailand, Malaysia and Vietnam.
Existing rigs which are host to mature reefs are micro marine-protected areas. Taking these rigs out of the water would constitute an environmental crime.
Massive potential for offshore wind
What else can the petroleum industry offer that no one else has? Offshore wind represents another under-developed asset class.
The offshore wind industry was born in Europe, enabled by more than 25 years of offshore petroleum operational know-how in the North Sea. Without this engineering knowledge base, offshore wind installations would never have survived for 20 to 30 years.
The International Energy Agency (IEA) estimates that offshore wind could deliver more than 400,000 terawatt-hours per year worldwide. That’s far higher than current levels of global energy production (electricity and other energy production), which was about 175,000 terawatt-hours in 2019.
Offshore wind is integral to the global energy transition.
What’s more, a lot of future offshore wind will come from floating installations in deep waters, relying on know-how derived directly from the offshore oil and gas industry.
At the same time, if we want to save the oceans, offshore wind installations need to encourage marine growth, applying lessons learned from the Gulf of Mexico.
This also provides opportunities for by-product revenue from marine aquaculture and ecotourism.
Marine aquaculture is vital if we want to feed 9 billion people without destroying the planet. Floating seaweed and shellfish farms, co-located with cultivated reefs – which we know how to grow from converted oil and gas rigs – are part of the solution.
Another killer app, ocean thermal energy technology or OTEC, can integrate these marine biodiversity farms into offshore renewable energy development.
As the holy grail of regenerative renewable energy, OTEC operates 24/7/365. The cold water pumped up for energy conversion is nutrient-rich, so it can support “no-feed” marine aquaculture. OTEC systems can also be designed to produce fresh water.
OTEC only works in deep water, typically 1,000 meters deep. If we want to scale it up, we need to deploy OTEC on floaters. Again, the know-how for these floating systems – which have already been adapted for floating wind – comes from offshore oil and gas.
A second life for aging ships
OTEC can also help meet International Maritime Organization (IMO) regulations to halve greenhouse gas emissions from maritime shipping by 2050.
The future of OTEC is on floating installations, and it is technically possible to convert 20-year old ships for OTEC duty. These aging ships can also host marine aquaculture and reef cultivation, as well as some solar panels and smallish wind turbines.
Retiring a typical ‘Panamax’ ship – a medium-sized vessel able to travel through the Panama Canal – 10 years early will avoid fuel emissions with a net reduction of about 0.5 million tons of carbon dioxide.
While the potential for rigs-to-reefs is maybe 200-300 rigs worldwide, the potential for wrecks-to-reefs is far higher, with at least 10,000 candidates. Converting 20-year-old freighters would be a good place to start.
Accelerated retirement of 10,000 Panamax class ships would avoid 5 billion tons of greenhouse gas while helping to grow natural capital in the oceans. Not enough to save the planet but a lot more than the Paris climate accords have achieved.
Expanding OTEC also opens another opportunity.
OTEC uses a commercially proven solution for low-grade geothermal energy, called organic Rankine cycle (ORC) generation technology.
Globally, there are tens of thousands of oil and gas wells with associated water that is typically too salty for agricultural, industrial or municipal use but within the right temperature range (90-110C) for ORC heat-to-power operations.
Scaling up OTEC can foster low-grade geothermal growth, and vice versa, creating a virtuous cycle.
ORC generation units can also be used for heat-to-power applications in heavy industries, especially hard-to-decarbonize industries like cement, iron and steel production.
Remember those cathodic protection systems that can be used to grow limestone? With a bit of focus research, those can also help recover minerals from oil and gas field production water, helping solve one of the biggest environmental problems for the upstream oil and gas industry.
Show me the money
Shell CEO Ben van Beurden also talked about the scale of investment required to save the planet – about 3-5% of GDP (or ~US$2-3 trillion) per year.
This scale of investment will come mainly from the private sector, enabled by government policy decisions.
The same governments that have spent trillions of dollars on Covid-19 response would be well-advised to implement the policies necessary to encourage Shell and its peers to start making the trillions of dollars per year required to save the planet. (Hint: don’t waste time and money traveling to COP26.)
Solutions such as offshore wind, OTEC and low-grade geothermal do not require any new technology. What they need is know-how from the oil and gas industry, as well as brute force investment of trillions of dollars per year for the next 10 years.
That, in part, will come from the corporate transformation of traditional petroleum companies. It is critical that governments open the door to let this happen.
