The Offshore (Oil and Gas) Installation and Pipeline Abandonment Charges (Revocation) Regulations 2026
These regulations establish a new charging regime for the decommissioning and abandonment of offshore oil and gas installations and pipelines in the United Kingdom.
They authorize the Secretary of State to recover costs from persons who have been served with a 'section 29 notice' by applying hourly rates for administrative, decommissioning, and environmental specialist staff, plus additional expenses for commissioned work.
The regulations apply to all holders of abandonment notices for offshore installations and submarine pipelines, excluding carbon dioxide pipelines, and clarify that all such holders are jointly and severally liable for the accrued charges.
Arguments For
The regulations state that the Secretary of State may recover expenses and costs incurred by the government while carrying out functions related to the abandonment of offshore oil and gas installations and pipelines.
Proponents may argue that the transition from fixed submission fees to hourly rates ensures that the financial burden of regulatory oversight is borne by the companies responsible for the installations rather than the taxpayer.
The document notes that the Secretary of State consulted organizations representative of the persons likely to be affected by these charges, as required by the Petroleum Act 1998.
Arguments Against
Joint and several liability means any single notice holder can be held responsible for the total debt of all parties involved in an installation, which industry participants may view as a financial risk.
Legal scholars or affected parties might point to potential ambiguity regarding the 'commencement of work date' for installations where notice was served before the regulations took effect.
Affected companies may argue that the lack of a full impact assessment overlooks the cumulative financial burden of increased hourly rates for specialist environmental and decommissioning staff.
Citation, commencement and extent
- -(1) These Regulations may be cited as the Offshore (Oil and Gas) Installation and Pipeline Abandonment Charges (Revocation) Regulations 2026 and come into force on 30th September 2026.
- (2) These Regulations extend to England and Wales, Scotland and Northern Ireland.
This section establishes the official title of the regulations and sets the date they become legally active as 30 September 2026.
It confirms that the rules apply across all jurisdictions of the United Kingdom.
Interpretation
- In these Regulations-
'the 1998 Act' means the Petroleum Act 1998;
'the 2012 Regulations' means the Offshore (Oil and Gas) Installation and Pipeline Abandonment Fees Regulations 2012;
'abandonment programme charges' means charges for, or in connection with, abandonment programme functions including the payment of expenses incurred by the Secretary of State;
'abandonment programme function' means a function of the Secretary of State under Part 4 of the 1998 Act, relating to the abandonment of-
(a) an offshore installation,
(b) a submarine pipeline, except a carbon dioxide submarine pipeline;
'carbon dioxide submarine pipeline' means a submarine pipeline that-
- (a) is, or has been, maintained, or
- (b) is intended to be established,
by a person for the purposes of an activity mentioned in section 17(2)(a), (b) or (c) of the Energy Act 2008;
'charging period' means a three month period beginning on 1st January, 1st April, 1st July or 1st October;
'section 29 notice' means a written notice given by the Secretary of State in accordance with section 29(1) of the 1998 Act;
'section 29 notice holder' means a person who has been given a section 29 notice.
This section defines the key terms used throughout the document to ensure precise legal application.
It distinguishes 'abandonment programme functions' (to which the charges apply) from activities related to carbon dioxide pipelines, which are excluded from these specific fee rules.
Commencement of work date
- -(1) Where a section 29 notice has been given in relation to an offshore installation or a submarine pipeline, before the coming into force of these Regulations, the 'commencement of work date' relating to that offshore installation, or that submarine pipeline, is the date these Regulations come into force.
(2) Where no section 29 notice had been given in relation to an offshore installation or a submarine pipeline, before the coming into force of these Regulations, the 'commencement of work date' is the date of service of the first section 29 notice in relation to an offshore installation or a submarine pipeline, as applicable.
(3) A section 29 notice holder is liable to pay abandonment programme charges notified under regulation 4(1) in relation to an offshore installation or a submarine pipeline, in respect of abandonment programme functions that the Secretary of State carries out on or after the relevant commencement of work date.
This section defines when the government can start charging for its work.
For existing projects, charging begins on 30 September 2026; for new projects, it begins on the date the person is first officially notified of their abandonment obligations.
Notice of abandonment programme charges
- -(1) Except as specified in regulation 8, the Secretary of State may recover abandonment programme charges where the Secretary of State has given a section 29 notice holder a section 29 notice of such charges that have been incurred during a charging period.
(2) The Secretary of State is not required to notify a section 29 notice holder that no abandonment programme charges have been incurred during a charging period.
(3) The notice under paragraph (1) must specify-
- (a) the charging period to which the charges apply, and
- (b) the amount of the charges and how that amount has been calculated.
The Secretary of State is authorized to recover costs by sending a notice to the responsible parties after each three-month period.
Each notice must clearly show the time period covered and provide a breakdown of how the total bill was calculated.
Payment of abandonment programme charges
- -(1) A section 29 notice holder must pay the charges notified under regulation 4(1) before the end of the period of 30 days beginning with the day after the day on which the notice was given by the Secretary of State under regulation 4(1).
(2) All section 29 notice holders for the offshore installation or submarine pipeline to which a notice under regulation 4(1) relates are jointly and severally liable to pay the charges notified under regulation 4(1).
Recipients of a charge notice must pay the full amount within 30 days.
If multiple people or companies hold an interest in the same installation, they are all collectively and individually responsible for the entire debt.
Calculation of abandonment programme charges
- -(1) The abandonment programme charges for a charging period for a particular offshore installation or submarine pipeline are to be calculated as (A x B) + (C x D) + (E x F) + G where-
A is the number of hours of work carried out on abandonment programme functions in the charging period by non-specialist administration officers;
B is £130;
C is the number of hours work carried out on abandonment programme functions in the charging period by non-specialist decommissioning officers;
D is £132;
E is the number of hours work carried out on abandonment programme functions in the charging period by specialist environmental officers;
F is £256;
G is expenses incurred by the Secretary of State for work commissioned in relation to abandonment programme functions.
(2) In this regulation-
'environmental function' means the abandonment programme function of considering the environmental effects of an abandonment programme and modifications and conditions in relation to those effects;
'non-specialist administration officer' means a person engaged by or on behalf of the Secretary of State to provide administrative support to non-specialist decommissioning officers or specialist environmental officers;
'non-specialist decommissioning officer' means a person engaged by or on behalf of the Secretary of State to carry out abandonment programme functions other than environmental functions;
'specialist environmental officer' means a person engaged on behalf of the Secretary of State to carry out environmental functions.
This section lists the specific hourly rates used to calculate the bill: £130 for administration, £132 for decommissioning officers, and £256 for environmental specialists.
It also allows the government to bill for any additional money spent on third-party work commissioned for the project.
Notices
- The following provisions apply to a notice served by the Secretary of State under regulation 4(1)-
(a) the notice must be in writing;
(b) the deemed date of service is as follows unless the contrary is shown-
(i) in the case of email or other electronic communication, the date the notice is electronically sent;
(ii) in the case of delivery by hand, the date of delivery;
(iii) in the case of postal delivery, the date that is the third day after the day the notice is posted;
(c) the Secretary of State may effect service by service on the last known electronic or postal address of a section 29 notice holder;
(d) service on one section 29 notice holder in relation to a particular offshore installation or submarine pipeline is to be treated as effective service on all section 29 notice holders who have received a section 29 notice in relation to that offshore installation or submarine pipeline;
(e) the section 29 notice holders for a particular offshore installation or submarine pipeline may make representations to the Secretary of State proposing an agreed address for service of notices and the Secretary of State must have regard to such representations.
This section sets out the methods by which the government can legally deliver charge notices, including email, hand delivery, and post.
It specifies that serving a notice to one project partner counts as serving all partners involved in that specific installation.
Saving provisions
- -(1) The Secretary of State may not recover abandonment programme charges under these Regulations for any work in respect of which a fee remains payable under an existing charging provision by virtue of regulation 3 of the Energy Act 2023 (Commencement No.5, Saving Provisions) Regulations 2026.
(2) For the purposes of this regulation, the existing charging provisions are the following sections as they had effect immediately before the appointed day-
- (a) section 29;
- (b) section 34.
This provision prevents double-charging.
The government cannot use these new hourly rates to bill for work if that work is already subject to fees under older legislation or previous transitional arrangements.
Revocation
- Except insofar as regulation 8 applies, the 2012 Regulations are revoked.
This section cancels the 2012 Regulations, which previously governed decommissioning fees.
The 2012 rules only remain in effect for the specific transitional cases mentioned in Section 8.
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