ABSTRACT

In 2014, GHD and the Australian Petroleum Production and Exploration Association (APPEA), now named Australian Energy Producers Ltd, developed a standard method to estimate the level of financial assurance necessary to meet the requirements of the Offshore Petroleum and Greenhouse Gas Storage Act 2006. That method was further reviewed and updated in 2018 (the 2018 APPEA Method). In 2024, following a review of the 2018 APPEA Method’s suitability for estimating costs in the current market, GHD and the Australian Energy Producers produced the Australian Energy Producers 2024 Method for Estimating Levels of Financial Assurance (the 2024 FA Method). The 2024 FA Method was endorsed by the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) in October 2024. The 2024 FA Method contains two parts – the General 2024 FA Method and the Vessel-based Activities (VBA) 2024 FA Method. Both methods were validated against an extensive set of contemporary case studies from the Australian oil and gas industry. This paper details the methodology undertaken to develop the 2024 FA Method, and the validation assessments undertaken. It provides additional context to support the cost relationships of the methods.