We often hear emotive calls that the human race should return to a simple lifestyle, but one thing is for certain – we cannot all go and live in caves, and become hunter-gathers as our Neolithic predecessors once did. There are a whole plethora of reasons why not, including the insufficient availability of caves and that fact that we humans have virtually eradicated most free roaming animals.
The straightforward and undeniable fact is that a sophisticated industrial model is required to support a population of Seven Thousand Million People, and growing, on this planet.
There is a huge, and somewhat hypocritical disconnect between fossil fuel production and fossil fuel consumption. The fabric of our current society is entirely dependent on production, yet we cannot wean ourselves away from consumption.
As global warming is intensely debated, the consensus is that our climate is changing and that human activity has a hand to play. Scientists and politicians will continue to argue and debate the issue Infinitum.
So, where's the disconnect?
‘Big Oil' produces fossil fuels as per the global demand. Since late 2014 production has exceeded demand creating an oversupply, a glut and an inevitable reduction in the price of the commodity. This mechanism has sent the global oil and gas markets into turmoil.
If we want to have an impact on fossil fuel production, then each one of us needs to ask the question – what will I do to reduce demand? Protesting about production might feel great, but it doesn't address the fundamental issue of consumption.
A recent picture from the North Dakota Pipeline protest illustrates part of the problem – passionate, well-meaning people protesting about production and onward distribution, but look carefully; How many small economical cars or even hybrids can you spot among the large V8 gas guzzlers?
North Dakota Pipeline Protestors Camp
Pictures of Asian megacities drenched in polluting smog, ‘dieselgate', mean global temperatures rising year on year, polar ice melt or hurricanes with ever increasing intensity are evidence enough that change is needed.
Most of us would applaud mechanisms that clean the air in our inner cities. Great strides are now being made in clean energy supply and electrification of our vehicles.
Hybrid and full-electric vehicles are no longer the odd-looking curiosities that used to have a range and power similar to a child's remote controlled toy.
Forward-thinking governments, city mayors, and institutions are working tirelessly on systems which encourage and support electric vehicles, while at the same time introducing disincentives for traditional polluting alternatives.
What will your personal choice be when your current car needs replacing?
Of course, it would be far too simplistic just to look at mass land transportation. Air and sea transportation is far more dependent on hydrocarbon use, and future solutions will be much more complicated.
We all tend to focus our attention on the easiest targets – vehicles, but ‘Big Oil' is still required for so much more of our modern lives.
If we were to remove all fossil fuel associated with land, air and sea transportation, our supermarket shelves would be bare, as would be most of our retail stores. Our hospitals would be turning away patients as there would be no medicines, assuming of course that patients and staff could reach the hospital in the first place.
A quiet, yet very significant revolution is taking place in power generation. Even ‘Big Oil' companies are becoming prominent in individual segments. Offshore wind farms have benefited tremendously from technology developed for offshore fossil fuel extraction.
As a society, we have a long way to go before we can even start to suggest that ‘Big Oil' is in terminal decline.
A few thoughts to ponder over:
- Most editorial content and opinion is published by those of us fortunate enough to be able to change our lifestyles and give up a few luxuries. The clear majority of the global population does not have this choice.
- World population is still growing, especially in areas of the world where a green revolution will be harder to implement.
- In the most simplistic terms, proven crude oil reserves of approximately are estimated at 1,500 billion barrels. Current production at 35 billion barrels a year and replacement at 5 billion barrels a year leaves a 30 billion barrels a year depletion.
- ‘Big Oil' won't disappear once we all drive electric vehicles.
- Wind farms are only useful when the right wind is blowing. The technology involved with storage capacity for the periods with no wind is still in an early and expensive phase. Until this issue is resolved, there will be conventional swing production requirements, (especially gas-fired power stations).
- We increasingly live in cities, and ever more so in high-rise buildings. City dwellers might be able to grow a few choice fruits, herbs or vegetables in pots and tubs, but there is no possibility to be self-sufficient.
Social media and the Internet, in general, is an excellent breeding ground for rumours, spreading misconceptions or plain and straightforward exaggeration. A recent ruling by the UK Advertising Standards Agency required an environmental campaigning group to refrain from implying that the fracking industry causes a number of environmental and health problems.
The oil and gas energy industry will become increasingly dependent on a workforce that has the skills to cut costs and minimise the carbon footprint. Those of us that believe in and can demonstrate, both these skill sets ought to be in high-demand for least a few more decades.
If those of us fortunate enough to still be employed in the business can all act as ambassadors for a sustainable future, then we can probably avert a premature decline of the industry.
Is a sustainability oil and gas industry a contradiction in terms? Let's look at why we propose otherwise:
- Most of us will agree that until we all make the difficult personal choices that dictate a carbon zero existence, then there will remain a requirement for fossil fuel extraction.
- For the next decade or so, the majority of those personal choices are simply too painful to even to contemplate.
- We can choose to live as sustainably as possible, but we cannot simply flick a switch to carbon zero overnight, therefore the need for fossil fuel extraction, production and consumption are not eradicated.
Events such as those on the night of 6th July 1988 are etched in the memory of those working in the oil and gas industry. Those memories are especially poignant in the close-knit communities from which the 167 offshore workers who lost their lives that night.
For those, us too young to remember, the Occidental-operated Piper Alpha production platform exploded and the catastrophic fire that ensued caused a sequence of events that led to the massive death toll, still to this day the worst human tragedy in the oil and gas industry.
Following the incident, a UK Government enquiry headed by Lord Cullen, and known as "The Cullen Report" made more than 100 recommendations, all of which were adopted by the UK industry. Many recommendations were also adopted internationally.
More recently, on 20th April 2010, the BP-operated Deepwater Horizon was also engulfed in fire after a blow-out, which led to the death of 11 offshore workers.
Following this incident, the world has awakened to the potential consequences of offshore drilling, and a whole raft of new operational legislation is in place.
Both incidents were wake-up calls to the many dangers relating to complacency, cutting corners and bowing to economic pressures.
Fossil fuel extraction is expensive, and especially so in deepwater basins, or regions where legislation is rigorously enforced to protect human life and the natural environment.
If society wants energy security, and inexpensive access to oil and gas then the industry needs to double down on costs. Since late 2014 there has been a necessity to focus on operational expenses, and for the most part, the supply chain has borne the brunt, so that major shareholders and stakeholders can be spared the pain. Hundreds of thousands of employees have lost their jobs and with it, their livelihoods.
Perhaps the next cost-reduction phase needs to be an in-depth look beyond the 'low hanging fruit'. A supply chain which struggles to make a profit will not be engaging in the development of future technologies the industry requires. The entire industry will not attract the next generation of Scientists and Engineers.
Designing, planning and operating a successful fossil fuel extraction business requires more than technology. At all levels, including the human element, there is a massive difference between best and worst in class.
We should all aspire to achieve a technical limit of at least best in class. The industry needs a calibre of individuals that believe in excelling in all that they do, and remain restless until they have been successful in that aim. Excellence needs to be across the board, (i.e. reducing exploration and production costs, carbon footprint, and environmental impact).
Piper Alpha and Deepwater Horizon have taught the industry that technical competence and experience are paramount, and cannot be compromised.
The recruiting industry can play a fundamental role in reducing costs at an early stage.
A Certificate of Compliance (COC) is obligatory when supplying equipment or services. Certification is not, in most cases, a result of a lack of trust, or a suspicious attitude on the part of the client. Suppliers can make mistakes, misinterpret their client's exact requirements or sub-contract work to companies less familiar with the task at hand. Issuance of a COC is only part of the process. A competent authority or several competent authorities will then check the COC to ensure that nothing has been overlooked.
As an industry, we should start to demand the same for the provision of personnel. A COC is, after all, a document certified by a competent authority, which ensures that the product (or candidate) matches the criteria of the work scope.
Technically screening candidates, verifying certification, experiences and qualifications should not be a side dish, but part of the main menu, and it should be a tasked performed by a competent authority. This essential responsibility should not be glossed over or delegated to someone else further along the supply chain. Technical Hiring Managers have more valuable uses of their time!
In today's fast-paced recruiting world, Executive Search has morphed to Connect on LinkedIn, whereas Candidate Screening & Verification has morphed to CV Key Word Matching.
The two distinctly separate entities of Executive Search and Employment Agencies have combined and created a situation where the skill sets required to screen and validate candidates are often missing from these organisations. All candidates possess a unique blend of academic qualifications, mandatory and optional vocational certifications, and experience. Recognising this unique blend is not an easy task and not one that can be delegated to individuals that lack the technical understanding to perform the role.
An effective and robust candidate validation process is core to ensuring the industry recruits the best-suited candidates and those most capable of creating a future cost-efficient and sustainable industry.
Ideally, Executive Search should be a function aligned to, and working in conjunction with Technical Hiring Managers (e.g. Operations Managers, Drilling Managers or Rig Managers). Conversely Employment Agencies are more traditionally aligned with HR Managers, and very well suited to managing specific areas of expertise in onboarding, payrolling and the plethora of candidate soft-skills.
At NatResPro, our entire team of candidate and client representatives have an in-depth technical understanding of the oil and gas industry, and as such we are well positioned to perform Executive Search functions. We are technical experts through hard-gained experience, both at the 'coal-face' and executive level and as such we feel our personnel deserve recognition as competent authorities.
- We understand the importance of technical screening, and the potential client cost-reduction benefits a robust verification process should create.
- We recognise that it takes a competent authority to validate candidates career histories.
- By enabling our clients to access best-in-class candidates, we provide a sure-fire way of assisting them with tackling operational costs, head-on.
Most industry professionals will acknowledge that it is possible for the recruiting industry to play a fundamental role in helping with a transition to a more sustainable future. Providing the equivalent of a COC for a candidate is not an easy task; it is something that requires a blend of technical experience, and a significant amount of time and effort. Attempting to provide clients with a robust candidate screening mechanism has a significant downside: the risk of profoundly annoying candidates.
Hiring capable and proven professionals with the appropriate blend of technical experiences and soft skills ought to be at the forefront in the battle with costs, performance and industry reputation. Second-best should no longer be an acceptable compromise.
Few of us will have much patience for a supplier Business Development Manager or Account Manager with little to no working knowledge of their product or service. Strangely this logic doesn't seem to apply to the supply of people - arguably the most vital resource in any company. The chances are very high that the initial candidate screening exercise will be performed by an individual with virtually no industry understanding. How many talented and capable candidates are overlooked or left stranded as a result? Did the keyword matching exercise take into account all of the variables used to describe the same technical keyword?
Current candidate supply and demand situation augurs well for the creation of an industry with a significant proportion of high-calibre people. There is a tremendous volume of talented people out there waiting for the opportunity to assist in building a stronger, more sustainable future for our industry. Does your supply chain provide you with full potential access?
Post Scriptum
Public opinion often concludes that anyone involved in the oil and gas industry cannot by definition be environmentally aware. I vigorously and wholeheartedly disagree.
We all have the potential of delivering excellence in our personal responsibilities. If we strive towards, and even beyond technical limit then we have the capacity to drive a more sustainable industry.
Collectively we can design and operate wells that are cost efficient, and of the highest wellbore integrity. We can also apply zero tolerance concerning zonal isolation or environmental issues. We can all start to identify and root out the attitudes and practices that portray our industry in a bad light.
As individuals, acting with the highest level of personal integrity will encourage others to do likewise, both in our work and home situations.
By taking a personal stance and leading by example, we should be able to create a more sustainable future for the beleaguered industry.
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