Supermajor companies no longer have enough experienced staff to deal with tail-end issues due to their involvement with lengthy projects, and this gives independents the upper hand in the mature end of the market. In the past, supermajors have turned to elite academic establishments for geophysicists, geologists and the best of the science and engineering crop, but they now need to expand their sources of recruitment.

There is a traditional career path for engineers, geologists and geophysicists to get to the top within the supermajors; but dealing with tail-end issues is not viewed as useful experience by many. End-of-life and decommissioning are not going to be as attractive to high flyers as the challenges of, say, reserves, replacement or transformation of business to encompass alternative energies.

But to neglect the tail end means that the national oil companies (NOCs) and independents have an immediate advantage in the mature or tail-end sector.

Think outside the box

The message to supermajors is not to do it all by yourself: enlist the skills of the wider industry community, particularly the contracting sector where they can offer wider job experiences and more in-depth technical and design opportunities. This is already being done, primarily through contractors moving up through the value chain and becoming duty holders and operators in their own right.

Contractors now source their best people direct from universities as well as from other heavy engineering sectors and related petrochemical, pharmaceutical and process industries. Today apprentices get the chance to work through a range of projects on their way to the top.

One example is Glen Graffin, 23, winner of the Offshore Contractors’ Association Future STAR Award who was tipped as an offshore installation manager of the future.

Supermajors must learn to compete in a much faster-moving environment where margins are thinner. Their once dominating influence is diminishing now that they no longer own the majority of the oil, so they are finding that they are now the niche.

The way many NOCs have achieved their strong position, apart from the advantages of government influence, has been by using the available talents and skills of the contractors they have partnered.

The same principle has to be extended not only between the contractors and the operators, but also to involve the academic institutions through adult learning and cross-discipline further degrees and post-graduate qualifications. There are some good examples of this within the OCA member companies, including PSN’s Re-Engineer postgraduate development programme.

The basic message is that contractors should take their responsibility for employee development seriously and not rely solely on picking superstars from the cream of academia.

Most of the supermajors have graduate development schemes but not dedicated academies and, even if they do, they are still only seeing the view from inside the organisation. In today’s environment, NOCs must have a much wider appreciation of what is going on both within and outside the oil industry.

While looking around for an opportunity to expand into business areas normally reserved for the operator, contractors have been able to fully use staff potential, sometimes picking up people released by operators and revitalising their careers. More importantly, they have been bringing in people from other industries with similar skills and different, innovative ways of working, and they have been more willing to adopt practices from other industries.

Creative resources

Skills shortages do not normally result in unfinished business, but they delay the outset of projects. People will not go ahead with a project until they are certain that it can be completed and they are imposing far stricter terms on contractors, and others, to ensure completion takes place.

“One solution to the supermajor skills shortage is to move the work to where the skills are.”

As tail-end life is extended due to unprecedented prices, facilities are requiring extensive upgrade and refurbishment. The need to divert people to perform such work is also affecting new developments.

The latest major oilfield to be developed in the North Sea – the Buzzard Field – was on time and on budget, but it required some fairly innovative initiatives and creative sourcing of the required skills. Much of the skilled staff was sourced from other basins and global centres, for example, the platform construction work was completed mainly by recruiting personnel in the Philippines.

An alternative solution adopted is to transfer work to where the skills are. Most of this is in design, but there has been some advanced project work done.

This has involved data that can be sent all round the world, for example, using Canada for software development, India for detailed design and Houston for front-end engineering.

If, instead of competing on all recruitment and employment matters, companies could cooperate to embed global common training, common job descriptions and common standards for performance, they could save a lot of money while spending less time negotiating costly assignment packages. Staff could move around more, and they would be less inclined to see a move to further their experience as a risk that could set back their whole career.

It is now widely accepted that people do not have careers for life and that people will move around. If energy companies do not recognise this, they are out of touch with the way the rest of the world is moving.

Cross-industry initiatives are also a good way to share knowledge. The Engineering Construction Industry Training Board runs fellowship programmes up to MSc level and there are some cross-industry projects with the aim of trying to bring students and companies together to work with each other.

When talking about projects suffering delays, it is not usually for the lack of the clever people at the top; it’s more likely because of a failure to appreciate the contribution that is made by the entire team including engineers, support staff, skilled technicians and craftsmen.

Cooperation and collaboration

“Oil companies and contractors must collaborate to develop staff skills.”

If companies got together as an industry and did something about promoting the careers at all levels in the industry instead of competing against each other, there could be a vast improvement in the skills shortage situation.

It costs money to develop people. If oil companies want to use contractors as a source of recruitment, that’s a perfectly reasonable thing to do, but they must pay up front and give contractors their fair recompense for training those people.

That would entail a fairly simple clause in the contract whereby the contractor could receive a percentage of the training costs of the individual, something along the lines of indentures. Contractors can play a role in developing people for the supers, but everyone must benefit.

As contractors develop into duty holders and take asset responsibility, trust in their capabilities will bridge the gap between traditional client and contractor roles. Cooperation and collaboration are key, otherwise the supermajors will see their ability to attract talent and complete projects diminished, allowing NOCs and independents to gain even more market share.

Offshore Contractors Association

The Offshore Contractors Association is the lead representative body for the UK’s oil and gas contracting and supply industry. From its Aberdeen headquarters, the organisation looks after the interests of almost 80 companies involved in a range of activities, including production, mechanical, electrical and allied services, construction, modifications and maintenance work, design and project engineering, fabrication and decommissioning.