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Oilfield Technology
May
2016
importantly, those willing to adapt their skills to meet companies’
new expectations.
One option to consider is whether to become a contractor.
For companies that are heavily reducing their permanent staff
numbers, contractors offer viable solutions when projects still
need to remain operational. Using contract staff provides skilled
consultants with the opportunities they need whilst giving the
company the flexibility they require to keep costs low.
Even though the vast number of job losses have been and
will continue to be in drilling operations, demand for contract
finance and accounting professionals, legal advisors, engineers
and geoscientists throughout the industry continues to be high –
particularly in Europe.
Advancedtechnologies
While the downturn is affecting some professions, it is also
helping to drive advanced technologies that boost operational
efficiencies. For example, one area that is on the rise in
Europe is the use of measurement-while-drilling (MWD) and
logging-while-drilling (LWD) tools, which collect data to improve
drilling accuracy. This is in turn creating a demand for skilled
industry professionals who can analyse data which can then
be used to perform statistical risk analysis for future well
operations.
In Europe there are a number of businesses that offer MWD
and LWD services to the industry and that offer contract positions
for those looking for the benefits of consulting over permanent
employment. These types of advancing technologies are creating
opportunities for those with backgrounds in field operations,
geophysics and geology, as well as reservoir and completions
engineers.
For other drilling professionals, extended reach drilling (ERD)
might be an option they want to consider. Rosneft, part of the
Sakhalin-1 consortium, announced last year that it had finished
drilling the world’s longest well at Chayvo field, which lies
northeast of Russia’s Sakhalin Island. This and other ERD projects
in Europe are generating jobs for contractors where typical oil rigs
are not.
Liveopportunities for contractors
Whilst many European companies are significantly reducing
upstream Capex and headcount, some companies have stuck
to their guns and are carrying on with longstanding plans
to develop certain oilfields while they ride out the current
market conditions. Statoil, for example, has just announced it
has started production drilling at its flagship Johan Sverdrup
development in Norway’s part of the North Sea. It is likely that
between now and 2019, when up to 380 000 boe/d are expected
to be produced, many hundreds of contractors will be required
across a vast range of disciplines.
In the UK, despite a contraction in employment of
approximately 15% since 2014, four new fields came on-stream
that year, bringing approximately 190 million boe into production.
The Department of Environment and Climate Change (DECC) is
also committing on average £3 - 4 billion per year this year and
next in upstream investment for new developments, which at the
very least will stave off some job losses.
As the European upstream industry declines further, there
are other areas of the job market that are still in high demand,
including cost management, risk management, supply chain and
capital reallocation and restructuring. Mostly office-based jobs,
but there for those in the know.
Shalegasandfracking
Despite the controversy surrounding hydraulic fracturing
– or ‘fracking’ – in recent years , there is no denying that
‘fracking-fever’ has coursed its way through the veins of several
European countries as they have looked at ways of overcoming
diminishing supplies of natural gas from older fields in the
North Sea.
In spite of some disappointing drilling results to date, there
are rumours that Europe might replicate the success of the US in
this area. Up until a decade ago, the outlook for shale was just as
bleak for America as it is in Europe, until new drilling and fracking
technologies saved the day and resulted in what some coined the
‘shale revolution.’ It is in the development of these technologies
for the European market where traditional gas professionals are
expected to benefit.
Renewableenergy
Europe is also seeing a huge rise in the production of renewable
energy, which for many contractors might be their new calling.
Former oil and gas project managers in particular look set to
benefit from the comparative ease at which they can transition
from old to new energy sectors.
According to trade union Sustainlabour, the European
renewables sector alone could produce some 6.1 million new jobs
by 2050, a large number of which are predicted to be available
specifically for the contractor market. This, coupled with reduced
investment in fossil-fuels, is likely to lead to a shake-up in the
labour market.
The industry has already seen a shift in the number of
contractors with traditional energy backgrounds looking for both
technical and managerial roles in the low-carbon sector – a trend
that is expected to continue rising. However, as is the case with
the upstream oil and gas sector more broadly, demand and supply
for skilled labour is not marrying up yet. For contractors looking to
make the move into the burgeoning renewables sector, now could
be the time to seek training and advice.
TheoutlookforEurope
The outlook for the upstream oil and gas market in Europe
continues to remain challenging and volatile, with significant
uncertainty being driven by a reduction in exploration and
extraction in the North Sea.
That said, these unpredictable times may prove less
damaging for many of the industry’s older generation
of engineers who will take advantage of a move back to
‘conventional’ oilfields in the North Sea. With prices at record
lows, many companies are looking back into their forgotten
inventory of conventional fields where drilling and production
costs can be lower, creating renewed demand for conventional
skills on a contract basis until the upturn.
However, for today’s drilling professionals in Europe who are
looking to stay within the industry – and who may not have the
luxury of years’ worth of experience behind them – contracting is
an option worth considering. Not only does it allow consultants
to go where the work is, but it provides a variety of opportunities
that are not always available to those working for one company.
This helps consultants to build up their experience in a variety
of different roles. For those who prefer permanent employment,
flexibility is key: they must be willing to retrain or use their
existing skills in transferable roles and they must stay at the
forefront of change to help them ride this wave of uncertainty
before the situation improves again in years to come.
