Set for a field day

Higher oil prices, coupled with the technology to tap previously unreachable or non-viable reserves, has resulted in a North Sea investment boom that is expected to create 15,000 jobs. Julia Pierce reports.

It is not long since observers predicted that the North Sea’s oil and gas industry was entering its twilight years and that production would slow as oil fields began to run dry.

Yet according to the UK Offshore Operators Association (UKOOA), this year a North Sea investment boom is expected to create about 15,000 jobs — hardly the sort of news you might expect from a ‘declining industry’. The reason is that higher oil prices and new technology has allowed operators to snap up fields and begin tapping previously unreachable or non-viable reserves.

‘New technology is being applied to all facets of the business — from materials to controls, to 4D seismic acquisition and fully- integrated reservoir simulation. All of these require sound fundamentals in engineering,’ said Robert Fast, operations technical manager at ExxonMobil.

His company is recruiting chemical, mechanical, electrical, and petroleum engineers for North Sea operations. ‘Technology development is enabling the industry to increase recovery and safely expand development into some of the most challenging environments on the planet. This industry has a history of applying technology to discover new resources and extend the life of existing resources,’ he added.

This year’s bidding round for North Sea operating and production licences pulled in a record 147 applications from 121 businesses. Many of the licensees are US energy companies and other overseas operators, all of whom are eager to invest in a stable political area at a time when tensions in the Middle East have at times sent oil prices towards new peaks.

According to Glasgow analyst Hannon Westwood, 112 exploration wells are likely to be drilled in the next two years at a total cost of £1.3bn. This activity is likely to add at least 1.5 billion barrels of oil and gas to the UK’s known reserves. They now stand at about 27 billion barrels, enough for another 20 years of UK consumption.

Continued commitment to the area by energy producers and their supporting contractors is good news for engineers, as demand for their skills remains high.

‘As a maturing province the North Sea is one of BP’s most diverse portfolios,’ said Rosemary Wilson, human resources manager with responsibility for organisational capability at BP. ‘It encompasses a complete lifecycle of exploration and production activity, from frontier exploration to development of the UK’s largest undeveloped gas field, as well as one of the most complex decommissioning projects ever undertaken.

‘Though the average size of field development has fallen from over 200 million barrels in the 1970s and 1980s to 20 million today, the remaining prize is still significant.’ The company is building a new engineering and petroleum North Sea headquarters in Aberdeen.

‘The North Sea continues to be crucial to the portfolios of large operators like BP,’ added Wilson. ‘It is generally accepted that the field has produced just over half of the total recoverable resource base. Attracting the right people will therefore remain critical to our business for a long time to come.’

As well as looking for industry-specific skills in the area of drilling and completions, reservoir and petroleum engineering, BP is also recruiting discipline engineers including mechanical, process, instrument and control, structural, integrity and corrosion.

Another energy multinational, Shell, is recruiting facilities, petroleum, production and well engineers. However, the company recognises that several factors are making positions increasingly hard to fill.

David Pappie, global attraction and recruitment manager for Shell International, said: ‘The number of people with the relevant skills is diminishing in many western countries as current workforces are rapidly reaching retirement age.

‘As a result, demand and competition for technical people skills is intensifying. Replenishing the right people in the right places will be vital to protect the future sustainability of the energy industry.’

A general upturn in demand for engineering personnel has not helped the situation. ‘As well as facing competition from the emerging markets overseas, we are also seeing an increase in competition from other sectors, such as the construction industry,’ said Wilson.

Beating the competition to the right candidates has therefore caused the industry to re-evaluate working practices and employee benefits. As the North Sea is a high-cost environment, most companies agree that simply raising salaries to attract staff may have the knock-on effect of pushing up production costs to the point where exploiting some fields is not viable.

However, they also recognise that in the modern employment market, staff may often value the quality of their working and home life above the measure of their take-home pay.

‘Our family-friendly policies and flexible working opportunities support our employees in achieving a healthy balance between work and home life,’ claimed Wilson. ‘We have what we believe to be a cutting-edge total reward package linked to individual contribution and to the success of the business. Our pension scheme is rated as one of the best in the UK.’

Shell’s Pappie added: ‘Factors such as salary, achievements, and recognition of a job well done are important but not sufficient for motivation.

‘Three factors are becoming increasingly important; job interest and challenges, work/life balance and career opportunities. Research indicates that by monitoring these three factors together, companies are more likely to retain young professionals.’

This view of the market is echoed by Chris Cooke, senior manager of human resources at Cameron Leeds, which supplies equipment to major oil and gas companies such as BP and Total.

He agrees that there is more to attracting and retaining staff than simply offering a high salary.

‘We continually take a critical look at our compensation and benefits package. However, we also look at the softer side of the business, examining factors such as the working environment, team structure and management style to identify ways of recognising people in non-monetary ways,’ he said, adding that the company is working to make itself more accessible to potential employees with experience outside of the oil and gas industry.

‘We are trying to get people from associated industries which are less buoyant than ours, provided they have relevant transferable skills and behaviours,’ he said. ‘Examples are aerospace, power generation and valves and related products — anywhere which has been dealing with safety-critical products.’

With North Sea exploration and production entering a renewed phase of activity and large companies such as BP cementing their commitment to the region, the North Sea’s oil and gas industry is rapidly shaking off any reputation it might have of being a fading entity. Both new technologies and changes in international politics have revitalised the region, and while it may be technically past the peak of production, high energy prices mean there is still plenty of scope for development of its remaining reserves.

Meanwhile, for those wishing to enter the industry, the sheer number and diversity of vacancies means that the chance of matching themselves to their ideal position is high.

‘This is the busiest period for recruiting that we have had in the North Sea,’ said Edward Jones, strategic services manager at industry support services company AMEC National Resources.

He says the employment situation looks set to remain.

‘This summer has been very active. We are recruiting heavily at the moment and will continue to do so,’ he said.