OneNexus introduces new approach to funding decommissioning costs
Published by Emily Thomas,
Deputy Editor
Oilfield Technology,
OneNexus has introduced OneNexus WellSecure. Developed by OneNexus to help the energy industry meet the challenge of its Asset Retirement Obligations (ARO), WellSecure is a financial contract that provides long-term financial security for the purpose of funding oil and gas decommissioning liabilities.
A sustainable funding mechanism
WellSecure is a permanent and secure approach to funding decommissioning costs that aims to help prevent the further accumulation of orphaned wells. A stable financial safety net, WellSecure offers peace of mind to stakeholders, including operators, non-operating partners, landowners, and regulators.
“OneNexus’ mission is to create a new category of innovative and responsible financial assurance tools to ensure that future generations are not left with the financial burden of today’s oil and gas decommissioning obligations,” said Tony Sanchez, Founder and CEO of OneNexus. “WellSecure provides oil and gas companies an opportunity to build an asset that adds value to their properties, mitigate plugging and abandonment (P&A) risks, and play a vital role in addressing one of the industry’s biggest challenges.”
WellSecure helps enable operators to fund P&A liabilities in current dollars at a discounted rate relative to the overall gross liability, with the rate being determined in part by the life of the well. Because costs are spread out over time, there is minimal impact to current cash flows. Additionally, its contract structure enables oil and gas producers to collect monthly payments from its partners through the Joint Interest Billing (JIB) statement while production cash flows are still strong, minimising the risk of non-payment by non-operating partners and account shortfalls down the road.
WellSecure’s structure allows companies to reduce the amount of ARO liability carried on their balance sheet, providing them the ability to enhance the value of their assets, rather than watch their value depreciate.
“No new orphaned wells is our mission,” said Sanchez, “and we believe WellSecure is the financial solution that our industry has been waiting for.”
Read the article online at: https://www.oilfieldtechnology.com/product-news/15112023/onenexus-introduces-new-approach-to-funding-decommissioning-costs/
You might also like
The President of the Republic of Cyprus meets Eni CEO
President Christodoulides and Eni’s CEO reviewed the discoveries made in 2022 by Eni and its partner TotalEnergies of Cronos and Zeus which led to the drilling of the Cronos 2 appraisal well in late 2023.