TheThe oil and gas industry has been aware of its talent shortage for years – fueled in part by retirements, a pause on graduate recruitment during the downturn of the 80s and cutting of training programs. But now that the industry is ramping up E&P (exploration and production) activity again, the shortage is more pronounced.
Still, some would say employers can look within their own organizations for potential leaders, but if there’s nobody in the pipeline – what can be done?
In a Feb. 28 whitepaper, David Armendariz, managing partner for executive search firm Lucas Group, addresses the topic of developing technical leaders. While the whitepaper focuses primarily on Houston, Armendariz looked at companies that are based and work in areas throughout the United States.
He said layoffs and tight budgets left oil and gas companies with less money to invest in technical skill development.
“Rather than grooming younger employees for top technical positions, companies were forced to slash training programs and cut payroll,” Armendariz said. “Now companies are finding that they have few, if any, mid-level employees who are adequately trained to take over more senior positions.”
Many laid off workers argue that there can’t possibly be a shortage of skilled professionals, given the 440,000 global layoffs. Armendariz said though there’s a larger candidate pool of younger candidates and industry veterans, many young professionals are looking outside of the industry – leaving another talent gap for the future.
“Many [industry veterans] are working on technical projects and are adding value, but the whitepaper focuses on leaders who will grow and shape the industry,” Armendariz told Rigzone. “Those skilled professionals – the high potential leaders – are still difficult to recruit out of their current companies. Firms that recognize the war for talent is still going strong will be best positioned for the industry’s rebound.”
Developing top technical talent is not impossible, but it does require a shift in recruitment strategy, said Armendariz said.
This involves:
• Understanding the current talent gap. This can be done by asking the following questions: What will our energy business look like in five years? How many mission critical employees do we currently have and where are we falling short? At a minimum, how many new hires do we need in each discipline or geography to bridge this gap? How much experience will our new hires have and how quickly can we help them gain additional on-the-job experience and develop their leadership skills?
• Maximize available talent. Rather than assessing the pool of potential leaders and modeling their likely advancement paths globally through the organization, some companies think only of their local talent – failing to track and coordinate their development at a global level. By redistributing talent throughout the organization, it will help the recruitment team better understand what gaps currently exist. Then they can develop a strategic model for long-term recruitment and internal promotion efforts.
Recruit talent with global leadership potential. In today’s industry, globalization and geopolitical risks are just as important as operational excellence and profitability. Tomorrow’s technical leaders must be global leaders as well.
• Look outside the industry for confident decision-makers and quick learners.Disqualifying candidates for a lack of technical skills won’t work anymore. Instead, companies need to think outside of the oil and gas talent box. These are the people who take it upon themselves to further their knowledge and leadership skills.
“Companies that are positioning themselves in the best way for future growth are spending money, time and resources to identify and grow future leaders,” Armendariz said. “High potential employees are easier to grow organically and are rooted in the company culture better than firms who are forced to recruit reactively.”
Global oil prices are now around the level where demand for talent looks set to pick up again, according to a new report from Petroplan.
Respondents from thirty-five organizations from across the major global oil and gas hubs participated in the survey, the aim of which was to gain insight from the industry’s employers on the prospects for recovery, and how this would impact on hiring in the near future, Petroplan said.
Activity is expected to pick up on onshore rigs first – in the US, then Middle East, Asia and Africa – followed by shallow water projects. Experienced technical talent, as well as those with a combination of technical and financial skills, look set to be most in demand in any recovery, according to the report.
Mechanical and chemical engineers, project managers and IT experts were among the shortage roles cited in the survey.
As sourcing staff has become less of an issue since the downturn, few companies are focusing on their future attraction strategy, the report said.
“When needed, internal searching across their own organization is often the first port of call, followed by tapping into their extended network before then engaging a recruitment company,” the report stated.
“Following cutbacks to reduce fixed cost overheads, mainly just the large companies still retain significant in-house recruitment teams with outsourcing to Interim teams now favoured by some organizations,” the report added.
Petroplan’s CEO Rory Ferguson hailed the review as cautiously optimistic.
“After a very challenging couple of years, our review reflects a cautious optimism for the future among energy employers. This is feeding through into hiring strategies that are focussed to a greater degree on cost efficiency and flexibility – but not at the expense of quality,” Ferguson said in a comment sent to Rigzone.
“Something that came across very strongly from the review is that, whilst employers want to fill roles quickly, they also want to find the right candidate in terms of technical and business culture fit,” he added.
Jobs Report: Oil, Gas Employment Sees Gains in February
It’s been a long time coming – mining employment increased in February, according todata from the U.S. Bureau of Labor Statistics (BLS) released March 10. The United States added 1,800 jobs in oil and gas extraction and 6,000 jobs in support activities for mining.
This is a far cry from previous months in which layoffs were reported each month before steadying in September. The BLS reports that mining employment has risen by 20,000 since October 2016.
There has certainly been an uptick in onshore activity with the Permian being a definite hot spot for prime acreage acquisition. Oil and gas CEOs are ready to forge ahead with projects and drilling.
February’s jobs report is a welcome sign to oil and gas, as well as the nation overall. The country added 235,000 jobs with other gains coming in industries such as construction and manufacturing. With February being the first full month’s report since Trump took presidential office, many credited him with the gains.
White House press secretary Sean Spicer tweeted this the morning of March 10.
Amec Foster Wheeler to Create 300 Jobs in Brunei After ‘Major’ Contract Win
Amec Foster Wheeler revealed Friday that it has secured a ‘major’ contract with Brunei Shell Petroleum Sdn Bhd (BSP) for the rejuvenation of assets in Brunei, which will see the company create over 300 local jobs.
As part of the contract, significant local development is planned, with the local supply chain anticipated to develop skills and capabilities through the lifetime of the project.
The work includes concept, Front End Engineering Design (FEED), detailed design, construction, completions and commissioning, marine management, fabrication management, procurement, and project management. Scheduled to run for five years from March 2017, with two one-year options to extend, the contract focuses on Brunei Shell Petroleum’s oil and gas assets in the South China Sea.
“I’m delighted that Amec Foster Wheeler has been selected to deliver such an important contract for Brunei Shell Petroleum,” Amec Foster Wheeler President of Oil, Gas & Chemicals John Pearson said.
“We are bringing together Amec Foster Wheeler’s unique combination of brownfield expertise, ‘More 4 Less’ methodology, global capabilities, and long-term customer relationships to maximize the value of Brunei Shell Petroleum’s assets in Brunei,” he added.
Amec Foster Wheeler’s ‘More 4 Less’ lean engineering methodology, originally developed to meet the challenges of the mature North Sea oil and gas industry, will play an important role in the contract with Brunei Shell Petroleum, the company said in a statement.
“Efficiencies from ‘More 4 Less’ have delivered Amec Foster Wheeler’s customers savings of up to 60 percent in time and cost, compared to traditional approaches,” an Amec Foster Wheeler representative said.
Statoil Scraps Plan To Build New Head Office After Job Cuts
OSLO, March 10 (Reuters) – Norway’s Statoil has ditched plans to build a futuristic-looking head office in Stavanger after cutting the size of its workforce by almost 3,000 in recent years, a spokesman for the oil and gas firm said on Friday.
Statoil in early 2014 launched plans to construct an oval building with a sloping roof to accommodate some 3,500 employees, but the price of Brent crude has since fallen by half, forcing a rethink.
“At that time we expected the need for office space to increase, but today the existing offices meet our needs,” Statoil’s spokesman Morten Eek said.
“It became possible after workforce reductions and more efficient use of workspace,” he added.
Statoil said on its website it has some 20,500 employees, down from 23,400 in 2013. In 2015, Statoil sold its head office building in Stavanger to Colony Capital Inc., signing a 15-year lease with a possible extension.
ExxonMobil Gulf Initiative to Create 45,000 Jobs
Exxon Mobil Corp. is positioning itself for future growth and part of that will come from $20 billion worth of investments into the company’s Growing the Gulf initiative.
Through the initiative, which ExxonMobil CEO Darren Woods announced Monday during the CERAWeek by IHS Markit conference in Houston, the company will invest $20 billion into 11 refining and chemical manufacturing projects in the U.S. Gulf Coast over a 10-year period.
The 11 projects will create more than 45,000 jobs, said Woods.
“These will be high skilled, high paying jobs averaging about $100,000 per year … and they are multiplier jobs, meaning they’ll create many more jobs in the community. We’re building a manufacturing powerhouse along the Gulf Coast.”
Woods also stressed the importance of innovation and said ExxonMobil was partnering with more than 80 universities to explore new energy frontiers.
“The only way to keep winning in a competitive market is to keep innovating,” he said.
ExxonMobil recently completed a $5.6 billion Permian acquisition, and Woods sees great opportunities there. Just a few months into his position as CEO, Woods said his priorities are the same as all the CEOs before him.
“It’s about growing shareholder value,” Woods said. “We’ve got to leverage our talent and capabilities. We’ve got a deep bench of technical skills and a rich portfolio of investments … I’m blessed.”
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