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Somewhere Over the Rainbow: Forecasts, Trends and Surveys. Presented By David Vaucher, IHS; Carolyn Stewart, NES Global Talent; Joseph Triepke, Oilpro
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NEW STRATEGIES & SOLUTIONS IN THE GLOBAL WAR FOR
TALENT April 8-9, 2014
u p s t a r t 3 6 0 . c o m / l i v e
SOMEWHERE OVER THE RAINBOW Forecasts, Trends And Surveys
Moderator: John Galiotos Dean of the Energy & Manufacturing Institute, Lone
Star College
David Vaucher Senior Manager, IHS
Carolyn Stewart Regional Business Development Manager-North America, NES
Global Talent
Joseph Triepke Managing Director, Oilpro
© 2014 IHS
ihs.com
IHS Presentation
CERA
Supply and Demand Analysis of New Petroleum Engineering Graduates in the US
Operating Cost Analysis Forum
April 2014
David Vaucher, Director, [email protected]
© 2014 IHS
• It’s true that engineers in other disciplines (mechanical, chemical) can work in the petroleum industry
• The equipment and processes in oil and gas are very specific
– While the underlying science is the same, petroleum engineers have a head start when it comes to working for operators
– Petroleum engineers usually have internship experience in oil and gas prior to working, which gives them priority when companies look for full time hires
• The demand for petroleum engineers is so great that for the same job, the premium they carry over mechanical engineers can be as high as 15%
• Petroleum engineers were particularly affected by the economic difficulties of the early 1980s
– This resulted in the “Great Crew Change”
Why petroleum engineers specifically?
4
© 2014 IHS
• An editorial written by Drs. Steven Holditch and Dan Hill of Texas A&M University in the June 2013 issue of the Journal of Petroleum Technology asked that question:
– “Is it deja-vu all over again?”
• They reference data collected by Professor Lloyd Heinze of the Texas Tech petroleum engineering department
• The results point to trends similar to those before the “bust” in the early 1980s
• BUT…the industry is very different today than it was 30 years ago
• A rigorous supply-demand analysis is required
Is there a petroleum engineering bubble forming in North America?
5
© 2014 IHS
Total enrollments have shot up recently
6
Source: Journal of Petroleum Technology, 2013
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
1972 1977 1982 1987 1992 1997 2002 2007 2012
Freshmen Sophomores Juniors Seniors Master's PhD
Petroleum Engineering Enrollment in the US by Academic Year
Source: IHS CERA © 2014 IHS
Enro
llmen
t by
Deg
ree
Plan
Academic Year
© 2014 IHS
Some schools have enrolled far more students than others
7
Source: Journal of Petroleum Technology, 2013
0
200
400
600
800
1,000
1,200
1,400
1,600
19721973
Co Mines Tx AM Tx Tech Texas La LafayetteOklahoma Mt Tech La State Tulsa MariettaPenn State W Va Alaska Mo Rolla KansasWyoming Houston NM Tech S Ca
Undergraduate Petroleum Engineering Enrolment by University
Source: IHS CERA © 2014 IHS
Enro
llmen
t
Academic Year
© 2014 IHS
• Professor Heinz's historical data used as a starting point
• Assumptions were made to project graduation rates into the future
– Emigration rates
– Graduation rates
• The supply of Master’s and PhD students was determined, but could not get a demand figure for these students
• The end date of 2028 was determined since it is 2013 + 15 years, which is considered the “sweet spot” for engineering professionals
• The model shows that it is very difficult to adapt quickly:
– The influx of graduates that we see today will not graduate for a few years
– Even if universities felt like they should cut enrollments today, the effects would not be felt for years
Building the supply model
8
© 2014 IHS
• The starting point was the IHS company valuation database
• Looked at production and employment data for over 100 companies
– Onshore (conventional/unconventional)
– Offshore
– Looked at barrels of oil equivalent (BOE) production
• This allowed IHS to determine the number of total professionals required to produce 1 million BOE (MMBOE)
• Using several factors (checked with professionals in industry), IHS obtained the number of entry-level petroleum engineers per MMBOE
Building the demand model
9
© 2014 IHS
Can the market absorb all of these new graduates?
10
Source: IHS
Oversupply
Undersupply
© 2014 IHS
• The United States was chosen deliberately for this first analysis:
– Good historical data available
– Assumptions could be verified relatively easily
– The shale gale has shone new light on the lack of skilled new talent
• There is a skills gap internationally also, though local considerations are important:
– In China, there is quantity of graduates, but what about quality?
– Brazil has strict local content laws
– Australia has strict immigration laws
• IHS now has a methodology in place if there is interest in pursuing this study beyond the United States
Considerations for the international market
11
© 2014 IHS
• There IS a near-term supply overhang
• This oversupply in the United States will be absorbed by more activity needed to increase production from fields around the country
• The supply-demand balance is extremely sensitive to the replacement rate of more experienced workers with new entrants to the industry
• For this reason, the supply of experienced professionals is tight
• The United States was the only country analyzed, but the situation is probably less balanced elsewhere
The takeaway: oversupply now which won’t last long
12
© 2014 IHS
Speaker biography
David Vaucher, Director Mr. Vaucher oversees the Upstream Operating Costs Forum and has several years of experience in the oil and gas industry. Prior to joining IHS he was with TAM International, a maker of specialty completion tools, where he was a Technical Advisor supporting the company’s global operations. He began his oil and gas career as an engineer at Schlumberger based in Texas, and has published several SPE papers. He is the current editor-in-chief of “The Way Ahead” magazine, the Society of Petroleum Engineer’s official publication for young professionals, as well as the author of the weekly column “Building Hydrocarbon Bonds” for the Houston Chronicle. Mr. Vaucher holds a Bachelor of Science degree in mechanical engineering from Rice University, an MBA from the University of Texas at Austin, and a Master’s in petroleum engineering from Texas A&M at College Station.
19
IHS Customer Care: • Americas: +1 800 IHS CARE (+1 800 447 2273); [email protected] • Europe, Middle East, and Africa: +44 (0) 1344 328 300; [email protected] • Asia and the Pacific Rim: +604 291 3600; [email protected]
© 2013 IHS. No portion of this report may be reproduced, reused, or otherwise distributed in any form without prior written consent, with the exception of any internal client distribution as may be permitted in the license agreement between client and IHS. Content reproduced or redistributed with IHS permission must display IHS legal notices and attributions of authorship. The information contained herein is from sources considered reliable but its accuracy and completeness are not warranted, nor are the opinions and analyses which are based upon it, and to the extent permitted by law, IHS shall not be liable for any errors or omissions or any loss, damage or expense incurred by reliance on information or any statement contained herein. For more information, please contact IHS at [email protected], +1 800 IHS CARE (from North American locations), or +44 (0) 1344 328 300 (from outside North America). All products, company names or other marks appearing in this publication are the trademarks and property of IHS or their respective owners.
David Vaucher
+1 713 850 7579
ATTRACTING AND RETAINING WOMEN IN OIL AND GAS ENGINEERING
A survey on the gender talent gap
Our promise: Guaranteed staffing solutions, engineered from the global talent pool by discipline specific consultants
Over 35 years’ experience finding talent for leading oil and gas, power, infrastructure, life sciences, chemical engineering and rail companies worldwide.
Awards and accreditations:
41 offices
25 countries
Over 500 discipline specific consultants
It’s not just a talent gap – it’s a gender gap
The global focus on attracting more women into the oil and gas industry is not just about creating a more diverse workforce, it is of vital importance if we are to continue to serve the world’s growing energy needs.
– Demand for engineering expertise is far outstripping supply and half the experienced engineering
workforce is set to retire in the next decade.
– While more is being done to encourage young women to study the STEM subjects this gender disparity continues to exist.
– In order to power future energy projects, the oil and gas industry must act now to fully tap into this enormous potential talent pool.
What should the sector do to solve the problem?
We conducted this survey to find out more about women working in the oil and gas industry, their career path and the challenges and opportunities of working in the sector. Key findings:
– 75% said they felt welcome working in the oil and gas industry, yet 45% said they do not feel
they get the same recognition as their male colleagues.
– 95% said mentors were important for career advancement, yet 42% said they were neither a mentor nor a mentee.
– When asked what companies could be doing to attract and encourage women employees
suggestions included: educating women early about careers in the oil and gas industry; giving women a chance to take on more challenging offshore roles; and providing equal benefits and opportunities.
Path into oil and gas engineering
‘What is the highest qualification you hold?’
Path into oil and gas engineering ‘Did you work in a different industry / profession before moving into oil and gas?’
yes 44% no 56%
‘Why did you choose to work in the oil and gas sector?’
Path into oil and gas engineering
Because it provides an opportunity to travel, offers interesting and varied work, good career prospects and earning potential.
“ “
‘Why did you choose to work in the oil and gas sector?’
Path into oil and gas engineering
I loved challenging myself right from when I was young. I grew up always wanting to compete with boys in maths and sciences, which I did. I was told that geology is a course for men, but that comment alone drove me to want to see what made it a career for men. Here I am, a female geologist in a man’s world.
“ “
‘Why did you choose to work in the oil and gas sector?’
Path into oil and gas engineering
It is an attractive sector in which I can expand my knowledge and meet different people. In the oil and gas sector, there are always changes and you don’t have to do the same task every day like a teacher for example.
“ “
Working in the oil and gas industry
‘As a woman, do you feel welcome in the oil and gas industry?’
Working in the oil and gas industry
‘Would you encourage a female friend to pursue a career in oil and gas engineering now?’
yes 89% no 11%
Working in the oil and gas industry
‘Would you encourage a female who is due to complete her studies in 10 years’ time to pursue a career in oil and gas engineering?’
Working in the oil and gas industry ‘Does your work currently provide you with adequate benefits to meet the needs of you and your family (e.g. childcare, flexible work hours, telecommuting)?’
yes 46% no 31% not relevant 23%
‘What could your company do to be more welcoming and encouraging of its women employees?’
Working in the oil and gas industry
Reach out to potential candidates and show that there are already women in the company so you’re not alone. Inform people about the industry because many people still think of oil covered roughnecks when speaking of the oil and gas industry. Inform people about the benefits and the challenges of the industry. Support a women’s network so there are actually other women to go to if information is needed or problems have to be solved.
“ “
‘What could your company do to be more welcoming and encouraging of its women employees?’
Working in the oil and gas industry
We need more senior female role models, both in technical and managerial positions. A lot of women drop out of the workforce before they reach those levels. “ “
‘What could your company do to be more welcoming and encouraging of its women employees?’
Working in the oil and gas industry
Increasing the field visits to develop our field backgrounds, enhancing women’s participation in leadership, giving women wider space in decision making and providing more accommodation for kids care during work time.
“ “
Mentorship ‘How important do you think mentors are for career advancement?’
Mentorship ‘Are you currently a mentor or a mentee?’
Career advancement ‘Do you feel you get the same recognition for your work as male peers?
YES 55% NO 45% /
Career advancement ‘Are you thinking of leaving the oil and gas industry in the next 2 – 5 years?’
‘What are some of the challenges you see inhibiting your job growth / career trajectory?’
Career advancement
A lack of mentorship - I would have been in a better position today if I had a mentor. Family - my current job does not provide a childcare facility. Lack of suitable roles - being a women, I have always felt this bias in every company I have worked for and also the remuneration for women is less than for men.
“ “
‘What are some of the challenges you see inhibiting your job growth / career trajectory?’
Career advancement
The most challenging aspect I find is getting an opportunity to work at restricted locations like offshore. These exposures and opportunities mean male peers are a step ahead. Another challenge is handling male peers or juniors who refuse to cooperate due to ego.
“ “
Career advancement ‘Would you consider taking less money for more work flexibility?’
The oil and gas industry is working hard to attract more women into the sector, but there is still a great deal more that must be done and done quickly.
– The industry needs to improve its image – it needs to show it is a place where women are
welcome and can achieve great success. – Mentorship is a key area of opportunity - only by supporting women into more prominent roles
can the industry create the female role models it needs to inspire others to join the sector.
– Oil and gas engineering is an exciting and rewarding career – the industry must better promote its benefits.
Conclusion
THANK YOU
Carolyn Stewart Regional Business Development Manager – North America carolyn.stewart@ nesglobaltalent.com www.nesglobaltalent.com
2 O&G Mega-Trends In 20 Minutes
Presented by Oilpro.com for Upstart 360 April 2014
Shale and Deepwater
Strong Near-Term Outlook for US Shale
Source: Baker Hughes, Bloomberg, Oilpro estimates
Aggregate Spending for 50 Independent E&Ps
An Unconventional Workforce Rising
Source: BLS, Baker Hughes, Bloomberg, Oilpro
Note: The 2009 spike is an anomaly due to rig count collapse during the financial crisis.
A Shale Revolution Needs Different Soldiers
Source: BLS, Oilpro
• Since ‘04, TX and ND account for 45% of US jobs growth
• TX jobs are up 20% and ND is up 30% since ‘04. All other states average +2%
• Especially since the Great Recession, most US jobs growth has been in O&G
It’s A Small World After All
• In 2009, the top 4 basins today were just 30% of the total US rig count. Today these same 4 basins account for 60% of US land rigs drilling
Regional Fragmentation in 2009 Consolidation in Key Basins today
Source: Baker Hughes, Oilpro
20 Counties Produce Half The US Oil Supply
Source: DrillingInfo
We Are Cautious Long-Term – Heed The Natural Gas Analogy…
Source: Baker Hughes, Bloomberg, Oilpro
Could Oil E&P Fall Victim To Its Own Success?
Source: Baker Hughes, Bloomberg, Oilpro
A Taste Of What’s To Come?
Source: Bloomberg, Oilpro
Midland Crude Oil Price Differential (vs. WTI)
Shale Takeaways
• Near-Term, The Activity Outlook Is Strong • Medium & Long-Term, Outlook Concerning • Labor Intensity Of Shale To Keep Rising • High Skilled Labor To Remain In Favor • Regional Consolidation Making Key Local
Markets More Competitive
Deepwater Pause Creates Uncertainty
Source: Bloomberg, Wall Street Research, Oilpro
But The Newbuilds Must Be Staffed
Source: Oilpro estimates
*These estimates account for crew rotation (at any one time, half this number is required to run the rig).
~15,000 New Deepwater Crewman Needed
Source: Bloomberg, Oilpro estimates
• DW offshore rig staff needs are shown
• Newbuild jackups also need 12,000 new hands over this period
• With onshore support, service, etc., offshore newbuilds mean 40,000+ new hires by 2017
Older Rig Attrition To Follow Newbuilds
Source: Bloomberg, Wall Street Research, Oilpro estimates
Exploration Fading Into Development
Source: Fearnley Offshore
Deepwater Takeaways
• Near Term Dayrate And Utilization Trends Are Very Uncertain
• But The Industry Must Staff Up New Rigs • The Coming Fleet Rationalization Will Affect The
Industry Labor Force; How Remains To Be Seen • The Shift From Exploration To Development Work
Should Be Viewed Positively But Is Nuanced
Questions / Contact Info
• Questions about these trends and other O&G issues can be posed to an engaged community of industry professionals at Oilpro.com/questions
• You can connect with and contact Joseph Triepke at Oilpro.com or by email at [email protected]
About Author: Joseph Triepke Managing Director, Oilpro.com Joseph Triepke is a finance professional with a decade of upstream experience. As an energy investor and analyst for institutions like Citadel, Guggenheim, and Jefferies, he developed proficiency in O&G research and analysis. Today, he is Managing Director at Oilpro.com where he oversees content created by the community and publishes his own research on oil services, equipment and drilling. Joseph earned a Bachelor’s of Business Administration in Finance from UT Austin with Honors in 2004 and currently resides with his wife in Dallas, TX.
June 19th WEBINAR Identifying High-performing Candidates That Will Succeed In Your Organization Sponsored by: SkillSurvey July 24th MICRO SUMMIT The Westin Houston, Memorial City
• Recruiting And Workforce Analytics • Hiring High-performing Candidates • Oil & Gas Salary Benchmark Survey
Sponsored by: Ascende, SkillSurvey
Fall 2014 WORKFORCE NEXT SUMMIT Premier event focused exclusively on recruiting/talent acquisition, retention and energy workforce management for Upstream, Mid-Stream and Downstream.
UPCOMING EVENTS
u p s t a r t 3 6 0 . c o m / l i v e
WORKFORCE NEXT brings together a high-level community of HR executives, talent and workforce management professionals, and stakeholders focused on labor demand issues and challenges in the energy industry.
• How to find & recruit great people in a hyper-competitive market • How to retain current employees • How to train, grow, motivate your teams • How to transfer knowledge from a rapidly retiring workforce • And how to keep up with ever-growing employment regulations
There are unique differences market-to-market and WORKFORCE NEXT focuses exclusively on challenges in the oil & gas and energy industries via live solution-based events where you’ll network with industry leaders.
U p s t r e a m ● M i d - S t r e a m ● D o w n s t r e a m
Learn More: WFN360.com
WORKFORCE NEXT
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