Offshore Energy Thematic Methods

1. Outcome

This Circular provides methodological guidance for accounting for offshore energy activities within ocean accounts. Offshore energy production represents one of the most significant human uses of the marine environment, encompassing both fossil fuel extraction (oil and gas) and renewable energy generation (wind, wave, and tidal)^[1]. The transition from fossil fuels to renewable marine energy sources creates unique accounting challenges that require careful methodological treatment.

1.1 Decision Use Cases

Offshore energy accounting directly supports critical policy decisions and planning processes that require quantitative evidence from ocean accounts:

Offshore wind site selection and spatial planning. Marine spatial planning authorities require systematic data on ecosystem condition, existing infrastructure, and cumulative impacts to evaluate competing offshore wind development proposals. Offshore energy accounts provide spatial footprint data, exclusion zone mapping, and ecosystem condition baselines that feed into the marine spatial planning processes described in TG-1.2 Marine Spatial Planning.

Oil and gas decommissioning accounting. Governments managing offshore oil and gas decommissioning face complex accounting decisions around asset retirement obligations, rigs-to-reefs conversions, and terminal cost provisioning. Asset accounts for offshore energy infrastructure (Section 3.4.2) enable tracking of decommissioning liabilities, while the rigs-to-reefs framework (Section 3.4.3) provides accounting treatment for partial decommissioning that creates artificial reef habitat. These accounts inform national balance sheet reporting and fiscal planning for decommissioning expenditure.

Energy transition tracking for climate policy. Nationally determined contributions (NDCs) under the Paris Agreement increasingly include offshore renewable energy targets and phase-out schedules for offshore fossil fuel extraction. Tracking progress against these commitments requires systematic compilation of energy supply-use tables distinguishing offshore fossil from renewable sources. The energy transition accounting framework (Section 3.5) enables governments to report on the shift from offshore oil and gas to marine renewables, supporting climate policy integration addressed in TG-2.8 Climate Indicators.

Renewable energy target monitoring. Countries with marine renewable energy targets (offshore wind capacity, tidal energy production) require regular monitoring of installed capacity, actual generation, and capacity factors. Physical energy accounts (Section 3.2) record installed capacity and generation by technology type, enabling comparison of actual deployment against policy targets and informing future target-setting.

1.2 Upward Connections

Offshore energy accounts provide inputs to multiple indicator and policy frameworks:

Climate indicators (TG-2.8). Blue carbon indicators, emission intensity by sector, and climate transition tracking draw directly on offshore energy accounts. Offshore fossil fuel extraction generates direct emissions (flaring, venting) and enables downstream combustion emissions. Offshore renewable energy displaces fossil generation, contributing to avoided emissions counted in national climate inventories. Section 3.5.3 details how offshore energy accounts feed into climate accounting.

Project finance (TG-1.8). Offshore energy developments increasingly rely on project finance structures including offshore wind bonds, blue loans for decommissioning, and carbon credit financing for avoided emissions. Asset accounts for offshore energy resources and infrastructure (Section 3.4) provide baseline valuations and monitoring frameworks that support project finance structuring and verification requirements described in TG-1.8 OA and Project-Level Finance.

Asset accounts (TG-3.1). Offshore energy accounting integrates with the general asset accounting methodology for both environmental assets (offshore oil and gas reserves, wind resources) and produced assets (platforms, wind turbines). The classification of renewable energy resources as distinct from mineral and energy resources, and the treatment of terminal costs for offshore infrastructure, are addressed in TG-3.1 Asset Accounts.

Ocean economy structure (TG-2.5). Offshore energy is a major component of ocean GDP in many coastal States. Section 3.2 details how offshore energy production accounts feed into the ocean economy supply-use tables described in TG-2.5 Ocean Economy Structure, enabling analysis of offshore energy's contribution to ocean value added, employment, and exports.

1.3 Policy Relevance and Badge Classification

As methods for offshore renewable energy accounting and cumulative impact assessment are not yet standardized within the SEEA framework, and energy transition accounting raises novel methodological questions, this Circular is classified as Emerging. Specific areas of emerging methodology include:

• Income attribution for floating offshore wind installations that do not have fixed seabed attachment, where the SEEA convention of attributing renewable energy income to underlying land assets presents implementation challenges (Section 3.1.2)
• Carbon capture and storage (CCS) accounting for depleted offshore reservoirs repurposed for CO₂ storage, where international statistical guidance remains under development (Section 3.5.3)
• Infrastructure repurposing accounting for offshore platforms converted from oil/gas to renewable energy use, requiring asset reclassification approaches not yet standardized (Section 3.5.1)
• Electromagnetic field (EMF) impact accounting for subsea cables, where research on EMF impacts on electroreceptive marine species remains limited (Section 3.3.2)

Reclassification to Applied may be considered once international guidance on these topics is formally adopted through the UN Statistical Commission process or the UNCEEA work programme.

The spatial scope of this Circular covers offshore energy activities within the Exclusive Economic Zone and on the continental shelf as defined by UNCLOS, including both fixed and floating installations. Activities within areas beyond national jurisdiction are addressed in TG-6.6 Deep Sea and Seabed Accounting. Support activities (supply vessels, helicopters, onshore substations) are addressed to the extent they are directly attributable to offshore energy operations; cable landfall infrastructure and onshore grid connections are addressed in TG-6.11 Coastal Infrastructure.

2. Requirements

This Circular requires familiarity with:

• TG-0.1 General Introduction to Ocean Accounts -- provides the conceptual framework for ocean accounting, including the relationship between economic activities and marine ecosystem assets, and the Basic Spatial Unit framework for georeferencing offshore activities.

• TG-3.10 Offshore Energy Accounts -- provides the foundational accounting structure for offshore energy, including supply and use tables, asset accounts for mineral and energy resources, and the classification framework for offshore energy activities. This Circular extends TG-3.10 by addressing thematic methods for cumulative impacts, decommissioning, and energy transition^[2].

2.1 Related Circulars

This guidance connects to several other circulars:

• TG-3.1 Asset Accounts -- general methodology for environmental asset accounts applicable to seabed mineral resources and ecosystem condition accounting for marine habitats affected by offshore energy.

• TG-3.3 Economic Activity Relevant to the Ocean -- industry classification guidance relevant to distinguishing offshore from onshore energy extraction, including the use of location-based satellite industry codes where available.

• TG-4.1 Remote Sensing Data -- methods for mapping offshore energy infrastructure using satellite imagery and Automatic Identification System (AIS) data, and for delineating exclusion zones.

• TG-6.5 Pelagic and Open Ocean -- accounting for offshore renewable installations in pelagic environments, including water column effects.

• TG-6.6 Deep Sea and Seabed Accounting -- relevant for deep-water energy developments and activities beyond national jurisdiction.

• TG-6.11 Coastal Infrastructure -- for accounting related to export cable landfall, onshore substations, and grid connection infrastructure that links offshore installations to national electricity networks.

2.2 International Standards Alignment

This guidance aligns with:

• SEEA Central Framework (2012) -- Treatment of mineral and energy resources as environmental assets, including categorization by commercial viability and accounting for decommissioning costs^[3]. The International Maritime Organization's MARPOL Convention and London Protocol provide additional regulatory context for discharge accounting and decommissioning at sea, and relevant regional seas conventions (such as OSPAR for the North-East Atlantic) establish additional obligations for offshore installation management.

• SEEA-Energy (2019) -- Physical and monetary supply and use tables for energy, asset accounts for fossil fuel resources, and classifications for renewable energy sources^[4].

• 2025 SNA -- Classification of renewable energy resources including wind, solar, water, and geothermal, and treatment of terminal costs for fixed assets^[5].

• UNCLOS (1982) -- Legal framework for offshore installations, safety zones, and sovereign rights over continental shelf resources^[6].

3. Guidance Material

3.1 Energy Type Classification

3.1.1 Fossil fuel extraction (oil and gas)

Offshore oil and gas platforms extract mineral and energy resources from beneath the seabed. These operations are classified within ISIC Division 06 (Extraction of crude petroleum and natural gas)^[7]. ISIC Division 06 does not distinguish onshore from offshore extraction at the four-digit level. Compilers should use location-based coding (associating production units with offshore spatial units) or national satellite industry codes where available to isolate offshore activities. For industry classification guidance in the ocean accounting context, see TG-3.3 Economic Activity Relevant to the Ocean.

Physical asset accounts record stocks of oil and natural gas resources using the United Nations Framework Classification for Fossil Energy and Mineral Reserves and Resources (UNFC-2009), which distinguishes^[8]:

• Class A: Commercially Recoverable Resources -- Deposits where extraction and sale has been confirmed economically viable (UNFC categories E1, F1, G1-G3).

• Class B: Potentially Commercially Recoverable Resources -- Deposits expected to become economically viable in the foreseeable future (UNFC categories E2, F2.1/F2.2, G1-G3).

• Class C: Non-Commercial and Other Known Deposits -- Resources not expected to become economically viable with current technology and prices.

Monetary asset accounts record the net present value of commercially recoverable resources, with revaluations reflecting changes in commodity prices, extraction costs, and discount rates^[9]. For worked examples of the net present value approach applied to offshore energy resources, see TG-3.10 Offshore Energy Accounts.

Where offshore reservoirs straddle maritime boundaries (transboundary reservoirs), compilers may need to coordinate with neighbouring country statistical offices to avoid double-counting or under-counting of shared resources. The SEEA Central Framework notes that "where mineral and energy resources are shared among two or more countries, only the country's share of the resource should be recorded in its asset accounts" (SEEA CF para 5.93)^[10].

3.1.2 Offshore wind energy

Offshore wind farms capture renewable energy from wind resources over marine areas. The 2025 SNA and SEEA-Energy classify wind energy resources as a type of renewable energy resource distinct from mineral and energy resources^[11].

Key accounting considerations include:

• Income attribution -- By convention, income streams from offshore renewable energy capture are attributed to the value of underlying land (or seabed) assets^[12]. For floating offshore wind installations that do not have fixed seabed attachment, this convention presents a methodological challenge. Compilers should record floating installations in the spatial unit corresponding to the licence or lease area to which they are assigned, and attribute income streams to seabed assets within that area. This treatment maintains consistency with the convention while acknowledging that the physical connection to a specific seabed location is indirect. As international guidance on this matter develops, compilers should monitor updates from the UNSD and UNCEEA.

• Fixed asset accounts -- Wind turbines, foundations, and transmission infrastructure are recorded as produced fixed assets with depreciation over their operational life.

• Capacity factors -- Physical accounts should record both installed capacity (MW) and actual generation (MWh), as capacity factors for offshore wind typically range from 35--50%.

• Cable infrastructure -- Array cables (connecting turbines within a wind farm) and export cables (connecting the wind farm to the onshore grid) may have different asset lives and ownership structures. Compilers should record these as separate asset classes where data permit, with array cables depreciated over the wind farm life and export cables potentially serving successive wind farm developments.

3.1.3 Wave and tidal energy (emerging)

Marine energy technologies that harvest energy from waves, tides, and ocean currents remain at early commercial stages. The Framework for the Development of Environment Statistics (FDES) defines renewable energy sources to include "tidal action, wave action, marine (non-tidal currents, temperature differences and salinity gradients)"^[13].

Two distinct tidal energy technologies should be distinguished for accounting purposes: tidal range (barrages and lagoons) which impound water and release it through turbines, creating large spatial footprints and significant ecosystem impacts on estuarine habitats; and tidal stream (underwater turbines) which extract energy from tidal currents with smaller spatial footprints but potential collision and noise impacts on marine fauna. These technologies differ substantially in their spatial, ecological, and economic characteristics and should be recorded separately in accounts.

Accounting for emerging marine energy technologies should:

• Track pilot and demonstration installations separately from commercial operations
• Record research and development expenditure as gross fixed capital formation per SEEA-Energy guidance
• Monitor installed capacity growth to inform energy transition scenarios

3.2 Compilation Procedure for Offshore Energy Accounts

This section outlines the step-by-step procedure for compiling offshore energy accounts, from data collection through account entry and integration with national accounts. This compilation procedure links the source data described in Section 4.1 to the decision use cases described in Section 1.1.

Step 1: Data collection and source identification

The compilation process begins with identifying and assembling the data sources required to measure opening stocks, production flows, additions, reductions, and closing stocks for each energy type. Primary data sources include:

• National petroleum and energy regulatory authorities provide licence areas, production data, reserves estimates, and decommissioning schedules for offshore oil and gas fields
• Environmental agencies provide impact assessments, monitoring data for ecosystem condition variables, and discharge permits
• Maritime authorities provide infrastructure locations, safety zone coordinates, and vessel tracking data (AIS)
• Energy companies provide financial reports, sustainability disclosures (following IFRS S2 and TNFD frameworks), and operational data
• Research institutions provide ecological studies, technology assessments, and condition monitoring results
• International sources including the International Energy Agency (IEA) for global energy statistics, the International Renewable Energy Agency (IRENA) for renewable energy capacity and cost data, and specialised databases such as 4C Offshore and the Global Wind Energy Council for offshore wind farm registries

Data quality should be assessed following TG-0.7 Quality Assurance, with particular attention to temporal consistency (ensuring opening and closing stocks are measured on a comparable basis), spatial coverage (ensuring data represent the full accounting area), and measurement uncertainty (documenting confidence intervals and data quality ratings).

Step 2: Classification and mapping to asset categories

Once source data are assembled, they must be mapped to the asset classification system. For offshore energy, the relevant SEEA CF asset categories are:

• Mineral and energy resources (offshore oil and gas, seabed minerals) -- Class A (commercially recoverable), Class B (potentially commercial), and Class C (non-commercial)
• Renewable energy resources (wind, wave, tidal) -- classified separately from mineral resources following 2025 SNA treatment

Physical accounts record stocks in natural units (barrels, cubic metres, MW installed capacity, MWh generation). Monetary accounts record net present value of expected resource rents (for oil and gas) or income streams attributed to seabed assets (for renewable installations).

Step 3: Physical supply and use table compilation

Physical energy supply and use tables (PSUT) record energy flows by product type (crude oil, natural gas, electricity from offshore wind, etc.) and by industry and final use category. The PSUT structure follows SEEA-Energy Chapter 3^[4:1]. For offshore energy:

Supply table records:

• Production from offshore oil and gas fields (by spatial unit and field)
• Production from offshore renewable installations (by technology and location)
• Imports of offshore-produced energy (where relevant for transboundary accounting)

Use table records:

• Intermediate consumption of energy within offshore operations (platform electricity, flaring losses)
• Exports of offshore-produced oil, gas, and electricity
• Final consumption of offshore renewable electricity by domestic users

The balanced PSUT provides the foundation for deriving energy self-sufficiency indicators, emission intensity by fuel type, and renewable energy share indicators that feed into TG-2.8 Climate Indicators.

Step 4: Monetary supply and use table compilation

Monetary energy supply and use tables record the same flows in monetary values, enabling calculation of gross value added, compensation of employees, and gross operating surplus for offshore energy industries. These monetary accounts feed into the ocean economy structure accounts described in TG-2.5 Ocean Economy Structure.

Key valuation considerations:

• Oil and gas production is valued at wellhead prices (excluding transport and processing margins)
• Offshore renewable electricity is valued at wholesale market prices or feed-in tariff rates
• Gross value added for offshore energy is calculated as output minus intermediate consumption

Step 5: Asset account compilation

Asset accounts track opening stocks, additions (discoveries, natural growth for renewable resources), reductions (extraction, depletion), reappraisals, and closing stocks. For offshore oil and gas, depletion equals extraction (as these are non-renewable resources). For offshore renewable resources, there is no depletion; the asset value derives from the stream of future income attributed to the seabed lease or licence.

The worked example in Section 3.6 demonstrates how to populate asset accounts for a hypothetical offshore oil field, including calculation of resource rent, depletion, and decommissioning provisions.

Step 6: Integration with national accounts and balance sheets

The final step is integrating offshore energy accounts with national balance sheets and with other ocean accounts. Integration ensures that:

• Depletion entries in asset accounts correspond to depletion costs in production accounts and adjustments to net domestic product (see TG-1.1 National Ocean Budgets)
• Extraction entries correspond to natural resource inputs in physical supply-use tables
• Investment in offshore infrastructure is recorded as gross fixed capital formation in produced assets
• Environmental impact entries in ecosystem condition accounts are consistent with offshore energy spatial footprints

3.3 Spatial Footprint Accounting

3.3.1 Seabed occupation

Offshore energy infrastructure occupies marine space through direct seabed contact and associated exclusion zones. Spatial accounts should record:

Direct footprint -- The physical area occupied by:

• Platform jackets and foundations (oil/gas)
• Monopile, jacket, or floating foundations (wind)
• Anchoring systems and mooring lines
• Subsea infrastructure (wellheads, manifolds, templates)

Cable corridors -- Export cables connecting offshore installations to onshore grids require seabed rights-of-way. UNCLOS Article 79 establishes that all States are entitled to lay submarine cables on the continental shelf, subject to coastal State jurisdiction over cables connected to installations^[14]. Cable landfall points and onshore substation accounting are addressed in TG-6.11 Coastal Infrastructure.

3.3.2 Exclusion and safety zones

UNCLOS Article 60 permits coastal States to establish safety zones around artificial islands, installations, and structures extending up to 500 metres from each point of the outer edge^[15]. These zones effectively exclude other marine uses including commercial fishing, navigation (for larger vessels), anchoring, and other seabed development.

In practice, the effective exclusion area often extends beyond the statutory safety zone due to navigation risk avoidance behaviour by vessel operators. Spatial accounts should therefore record both the statutory exclusion area (defined by regulatory designation) and the effective exclusion area (observed through AIS vessel tracking data showing actual avoidance patterns). The effective exclusion area provides a more accurate picture of the spatial impact of offshore energy developments on other ocean uses. For guidance on using AIS and satellite data to delineate effective exclusion zones, see TG-4.1 Remote Sensing Data.

3.3.3 Integration with marine spatial planning

Offshore energy spatial data should be compiled in formats compatible with marine spatial planning systems, typically as georeferenced polygon layers showing lease/licence boundaries, infrastructure locations, cable routes, safety/exclusion zones, and planned development areas. Data format recommendations should be consistent with those established in TG-1.2 Marine Spatial Planning.

3.4 Cumulative Impact Assessment

This section provides methods for recording the environmental impacts of offshore energy in formats suitable for incorporation into ecosystem condition accounts. The quantitative treatment links physical impact measurements to the condition variables defined in SEEA Ecosystem Accounting, enabling cumulative impacts to flow through to ecosystem condition assessments. For general methodology on ecosystem condition accounting, see TG-3.1 Asset Accounts.

Table 3.1: Offshore energy environmental impact comparison

3.4.1 Underwater noise

Offshore energy activities generate underwater noise during construction (pile driving), operation (machinery, vessel traffic), and decommissioning (explosive cutting, removal operations)^[16].

Accounting for noise impacts requires:

Source characterization -- Recording noise source levels, frequencies, and temporal patterns by activity type and location. These measurements should be compiled as supplementary physical data tables linked to the relevant spatial unit and time period.

Receptor mapping -- Identifying noise-sensitive marine species, particularly marine mammals and fish, in relation to energy developments. UNCLOS Article 65 requires States to cooperate for the conservation of marine mammals, with cetaceans receiving particular attention through appropriate international organizations^[17].

Impact pathways -- Linking noise exposure to ecological outcomes including behavioural disturbance, masking of communication, temporary or permanent hearing threshold shifts, and physical injury at close range. These pathways should be documented as condition indicators within ecosystem condition accounts.

The Taskforce on Nature-related Financial Disclosures (TNFD) recommends metrics for noise pollution including "average noise level on-site during noisiest part of the day" and "distance from nearest habitat"^[18]. While these TNFD metrics are designed for corporate disclosure rather than national accounting, they provide a useful starting point for national compilation. Compilers may aggregate corporate TNFD disclosures across all operators within a spatial unit to derive national-level noise impact indicators, supplementing these with regulatory monitoring data where available.

3.4.2 Electromagnetic fields (EMF)

Subsea power cables generate electromagnetic fields that may affect electroreceptive marine species (sharks, rays, some crustaceans). Research on EMF impacts remains limited, and this is an area requiring future methodological development as empirical evidence accumulates. Current accounting practice should:

• Record cable specifications (voltage, current, burial depth, shielding) as supplementary physical data
• Map cable routes in relation to sensitive habitats using georeferenced data
• Monitor and report any observed behavioural effects as condition indicators where monitoring data are available

As the evidence base on EMF impacts grows, more specific accounting guidance may be warranted. Compilers should monitor developments in this area through relevant international research programmes.

3.4.3 Habitat modification

Offshore energy infrastructure modifies marine habitats through several mechanisms:

Substrate introduction -- Hard structures (platforms, foundations, scour protection) create artificial reef habitat in otherwise soft-sediment environments. The IUCN Global Ecosystem Typology classifies "Submerged artificial structures" (M4.1) as a distinct ecosystem type characterized by "an abundance of zooplanktivorous fish" and "filter-feeding invertebrates"^[19]. The question of whether artificial habitat creation should be recorded as ecosystem extent change is methodologically significant. Compilers should record the introduction of hard substrate as a change in ecosystem type within extent accounts (from, for example, soft-sediment benthic to M4.1 submerged artificial structures), while noting that the ecological value of artificial habitat may differ substantially from natural reef. For general guidance on ecosystem extent accounting, see TG-3.1 Asset Accounts; for coral reef regions specifically, see TG-6.1 Coral Reef Accounts.

Sediment disturbance -- Installation and cable burial activities disturb seabed sediments, potentially releasing contaminants and altering benthic communities. These impacts should be recorded as condition changes in the affected spatial units.

Hydrodynamic changes -- Large arrays of offshore structures may alter local currents, wave patterns, and sediment transport. Research on the hydrodynamic effects of large offshore wind arrays is increasingly documenting measurable changes to local oceanographic conditions. While not yet incorporated into standardized accounting frameworks, compilers should record observed hydrodynamic changes as supplementary information where monitoring data are available, as these effects may become material for condition accounting as offshore wind capacity grows.

3.4.4 Collision risk

Marine fauna may collide with offshore energy infrastructure:

Seabirds -- Offshore wind turbines present collision risk for migratory and foraging seabirds. Empirical evidence suggests mortality rates for offshore installations are generally lower than for onshore wind, though considerable uncertainty remains in population-level estimates, particularly for long-lived seabird species with low reproductive rates. Impact assessment should adopt precautionary approaches when recording collision mortality in ecosystem condition accounts, clearly distinguishing observed mortality from modelled estimates.

Marine mammals -- Vessel traffic associated with offshore energy operations increases collision risk for cetaceans and pinnipeds. These impacts should be recorded as pressure indicators in ecosystem condition accounts.

Fish and invertebrates -- Entrainment in cooling water intakes (for platforms with power generation) may impact fish populations. Tidal stream devices also present potential collision risk for marine mammals and large fish species.

Impact assessment should account for collision mortality as a component of ecosystem condition change, with particular attention to species of conservation concern.

3.5 Decommissioning Accounting

3.5.1 Asset retirement framework

The SEEA Central Framework distinguishes between terminal costs and remedial costs for fixed asset disposal^[20]:

Terminal costs are anticipated during production periods and should be provisioned through consumption of fixed capital allowances over the asset's life. Examples relevant to offshore energy include removal of platform topsides and jackets, plugging and abandonment of wells, cable removal or burial, and site clearance and verification surveys.

Remedial costs are incurred after operations cease, often by parties other than the original operator: cleanup of contaminated seabed sediments, long-term monitoring of residual structures, and rehabilitation of impacted habitats.

The 2025 SNA glossary defines terminal costs as "costs incurred on the disposal of an asset or at the end of its service life" covering "de-installation and decommissioning costs (in case of oil rigs or nuclear power stations) or rehabilitation costs of land sites"^[21].

Where the original operator no longer exists (abandoned or orphaned infrastructure), government remediation expenditure should be recorded as government gross fixed capital formation where it creates a land improvement asset, or as government intermediate consumption for ongoing environmental protection activities. Compilers should identify orphaned offshore installations separately in supplementary tables, as these represent a distinct liability category for public accounts.

3.5.2 Rigs-to-reefs programmes

Some jurisdictions permit partial decommissioning where platform structures are left in place to function as artificial reefs. Research indicates that "more than 500 oil and gas platforms were decommissioned and left as artificial reefs in US waters since 1940" with "more than 600 in the Asia-Pacific alone" as candidates for reefing^[22].

Accounting treatment for rigs-to-reefs conversions should:

• Record the reduction in decommissioning liability (terminal cost avoided)
• Consider any payments to or from regulatory authorities
• Track the converted structure as a distinct ecosystem asset (IUCN GET M4.1) if ongoing monitoring indicates ecological function
• Account for any ongoing maintenance or monitoring obligations

Note that oil and gas infrastructure left as artificial reefs "is more exposed to light/noise/chemical pollution associated with operations as well the spread of invasive species" compared to purpose-built artificial reefs^[23]. This pollution legacy should be reflected in the condition assessment of converted structures. For coral reef regions where rigs-to-reefs programmes may interact with natural reef systems, see TG-6.1 Coral Reef Accounts.

3.5.3 Remediation expenditure

Where decommissioning reveals contamination or environmental damage, remediation expenditure should be recorded as:

• Gross fixed capital formation when creating a land improvement asset (remediated site)
• Intermediate consumption when representing ongoing environmental protection activities

SEEA-Energy notes that "expenditures on the decommissioning of nuclear power plants" represent one area where economic response to environmental issues can be highlighted^[24]. The same principle applies to offshore oil and gas decommissioning, which may be recorded as environmental protection expenditure within thematic and extended accounts for environmental activity.

3.6 Energy Transition Accounting

3.6.1 Fossil to renewable transition

The shift from offshore fossil fuels to marine renewable energy creates accounting challenges at multiple levels:

Asset revaluation -- Declining demand for fossil fuels may reduce the economic value of oil and gas reserves, recorded as downward reappraisals in physical asset accounts and revaluations in monetary accounts.

Infrastructure repurposing -- Some offshore oil and gas infrastructure may be converted for renewable energy use. Examples include platforms serving as bases for wind turbines, pipelines repurposed for hydrogen transport, and wellbore infrastructure converted for geothermal energy extraction. While accounting guidance for infrastructure repurposing is still developing, compilers should record the reclassification of assets from one purpose to another as other changes in volume of assets, noting both the write-down of the original asset and the acquisition of the repurposed asset. Case studies from jurisdictions with active repurposing programmes (such as North Sea States) should be consulted as they become available.

Workforce transition -- Employment shifts from fossil fuel to renewable sectors should be tracked through labour accounts linked to ISIC industry classifications. See TG-3.5 Social Accounts for guidance on compiling ocean-related employment and workforce transition indicators.

3.6.2 Stranded asset treatment

The IFRS S2 Climate-related Disclosures standard requires entities to disclose "the amount and percentage of assets or business activities vulnerable to transition risks"^[25]. For offshore energy, stranded assets may include oil and gas reserves that become uneconomic due to carbon pricing or demand decline, infrastructure with remaining useful life that is retired early, and exploration and development expenditure written off due to project cancellation.

In SEEA terms, these events are recorded as:

• Downward reappraisals (Class A to Class B/C) for resource reclassification
• Other changes in volume of assets for unexpected retirements
• Write-offs for exploration expenditure on abandoned projects

Stranded asset accounting is an active area of international discussion. The triggers for recording stranded assets may include policy announcements (carbon pricing legislation), market signals (sustained commodity price declines), or physical events (infrastructure damage from extreme weather). Compilers should monitor guidance development from the UNSD and UNCEEA, and document the triggers used in national compilations for transparency.

3.6.3 Carbon and climate accounting

Offshore energy activities interact with climate accounts through:

Emissions -- Fossil fuel extraction generates direct emissions (flaring, venting, fugitive methane) and enables downstream emissions from combustion. For recording these flows, see TG-3.4 Flows from Economy to Environment.

Carbon storage -- Some depleted offshore reservoirs may be repurposed for carbon capture and storage (CCS). CCS in offshore reservoirs creates novel accounting challenges, including whether stored carbon represents negative extraction, a new asset type, or an environmental protection service. As international statistical guidance on CCS accounting is still under development, compilers should record CCS activities in supplementary tables pending the adoption of standardized treatment. Key recording items include the volume of CO₂ injected (physical units), storage capacity of the reservoir, and expenditure on CCS infrastructure and operations.

Avoided emissions -- Offshore renewable energy displaces fossil fuel generation, contributing to emission reductions counted in national inventories.

The SDG indicator framework includes "Amount of fossil-fuel subsidies per unit of GDP (production and consumption)" (Indicator 12.c.1) which can be partially compiled from offshore energy accounts^[26]. For guidance on compiling SDG indicators from ocean accounts, see TG-2.10 MEA Indicators.

3.7 Worked Example: Synthetic Offshore Energy Account

This section presents a worked example demonstrating how to compile physical and monetary accounts for offshore energy using synthetic data for a hypothetical coastal state. The example illustrates the compilation procedure described in Section 3.2 and the account structures presented throughout Section 3.

Scenario description

The accounting area is a coastal State's Exclusive Economic Zone containing one mature offshore oil field and one operational offshore wind farm. The accounting period is calendar year 2025.

Offshore oil field parameters:

• Total recoverable reserves (Class A): 200 million barrels
• Development cost (GFCF): $15,000 million
• Annual extraction rate: 20 million barrels
• Expected production life: 10 years
• Oil price: $70/barrel
• Annual operating expenditure: $800 million
• Estimated decommissioning cost: $2,000 million

Offshore wind farm parameters:

• Installed capacity: 500 MW
• Capacity factor: 0.42
• Annual generation: 1,839,600 MWh
• Design life: 25 years
• Construction cost (GFCF): $2,500 million
• Annual O&M expenditure: $50 million
• Wholesale electricity price: $80/MWh

Physical asset account for oil field (biomass in million barrels)

Table 3.2: Physical asset account for offshore oil field, 2025

Monetary account for oil field (values in million USD, annual)

Table 3.3: Production account for offshore oil field, 2025

The negative net value added indicates that under the assumed price of $70/barrel, the field generates gross operating surplus but after deducting consumption of fixed capital (including decommissioning provision), net income is negative. At higher oil prices (e.g., $120/barrel), gross output would rise to $2,400 million and net value added would become positive.

Decommissioning provision: Terminal costs of $2,000 million are provisioned over the 10-year production life at $200 million per year, recorded as part of consumption of fixed capital. If actual decommissioning costs in Year 11 exceed the provision (e.g., $2,500 million due to unexpected contamination), the excess $500 million is recorded as remedial costs in the period incurred.

Physical supply account for offshore wind (energy in MWh)

Table 3.4: Physical supply account for offshore wind, 2025

Monetary account for offshore wind (values in million USD, annual)

Table 3.5: Production account for offshore wind, 2025

The negative net value added illustrates that the wind farm's viability depends on factors not captured in this single-year snapshot, including government subsidies (feed-in tariffs, renewable energy certificates), avoided carbon costs, and expectations of rising wholesale prices. Compilers should record any subsidies received as current transfers in the distribution of income account.

Spatial footprint summary

Table 3.6: Spatial footprint account for offshore energy installations, 2025

Environmental impact summary

Table 3.7: Environmental impact account for offshore energy installations, 2025

These impact indicators feed into the ecosystem condition accounts described in Section 3.4, enabling cumulative impact assessment across multiple installations within a spatial unit.

Integration and upward connections

The worked example demonstrates several key linkages in the ocean accounting system:

Upward linkages to policy (TG-1.x and TG-2.x):

• TG-1.1 National Ocean Budgets: The $200 million decommissioning provision represents a significant fiscal liability that should be incorporated into medium-term expenditure frameworks. The $20 million depletion of oil reserves (at constant prices) represents natural capital drawdown that should be deducted from gross income to calculate environmentally adjusted net domestic product.
• TG-2.8 Climate Indicators: Direct emissions of 450,000 tonnes CO₂-eq from the oil field contribute to national greenhouse gas inventories. The 1.84 TWh of offshore wind generation displaces approximately 900,000 tonnes CO₂-eq of fossil generation (assuming grid emission factor of 0.5 kg CO₂/kWh), contributing to emission reduction indicators.
• TG-1.8 Project Finance: The offshore wind farm's capital structure (total investment $2,500 million, annual revenue $147 million) illustrates the project finance challenges for offshore renewables, where long payback periods and policy support requirements create financing gaps addressable through blue bonds or sustainability-linked loans.

Cross-account consistency:

• Oil extraction of 20 million barrels corresponds to extraction recorded in physical supply-use tables
• Depletion of $20 million (at constant prices) corresponds to adjustments in monetary asset accounts
• Offshore wind generation of 1.84 TWh flows into national energy balance tables
• Spatial footprints are consistent with marine spatial planning databases

This worked example illustrates how offshore energy accounts provide a structured framework for organizing diverse data sources, maintaining accounting identities, and deriving policy-relevant measures for energy transition, climate action, and sustainable ocean management.

4. Acknowledgements

This Circular has been approved for public circulation and comment by the GOAP Technical Experts Group in accordance with the Circular Publication Procedure.

Authors: Offshore Energy Working Group

Reviewers: Technical Expert Panel

4.1 Data Sources

Key data sources for offshore energy accounting include:

• National petroleum/energy regulatory authorities (licence areas, production data, decommissioning schedules)
• Environmental agencies (impact assessments, monitoring data)
• Maritime authorities (infrastructure locations, safety zones)
• Energy companies (financial reports, sustainability disclosures)
• Research institutions (ecological studies, technology assessments)
• International sources: the International Energy Agency (IEA) for global energy statistics, the International Renewable Energy Agency (IRENA) for renewable energy capacity and cost data, and specialised databases such as 4C Offshore and the Global Wind Energy Council for offshore wind farm registries

4.2 Coordination Requirements

Effective offshore energy accounting requires coordination between:

• National statistical offices (national accounts, SEEA implementation)
• Energy ministries (resource management, energy policy)
• Environment ministries (ecosystem impacts, protected areas)
• Maritime authorities (spatial planning, infrastructure regulation)
• Industry associations (standardised reporting, technology information)
• Regional bodies (shared maritime zones, transboundary coordination)

4.3 Emerging Methodological Issues

Several areas require ongoing methodological development:

• Ecosystem service valuation -- Methods for valuing artificial reef ecosystem services created by offshore structures
• Cumulative impact thresholds -- Frameworks for assessing when combined impacts exceed ecosystem carrying capacity
• Cross-border accounting -- Treatment of offshore installations in shared maritime zones or areas beyond national jurisdiction
• Floating infrastructure -- Accounting treatment for mobile offshore installations (floating production units, floating wind turbines)
• Emerging offshore activities -- Offshore hydrogen production, offshore desalination, and marine data centres represent emerging ocean uses that may require dedicated accounting guidance as they reach commercial scale. Compilers should monitor these developments and record pilot installations in supplementary tables where they occur.

5. References