With an inherent tone of rational optimism, a panel of industry executives addressed guests of the Offshore Technology Conference (OTC) about how companies are, and can continue, to cope with lower oil prices.
Lars Eirik Nicolaisen, partner for Rystad Energy, delivered a rather bullish outlook on the future of oil prices, suggesting we may see $100 oil within the next five years. Though it’s not certain whether “lower for longer” will turn into “sooner than later,” oil and gas companies are taking note on lessons from the past.
Though significant workforce reductions have occurred throughout the sector for the past year-and-a-half, industry leaders are adamant in doing all they can to maintain their talent pipelines during the downturn.
“If you look back, the biggest mistake that we’ve made is when we downsized in the 80s, and we just gave up on young folks. We said ‘We’re just going to keep whoever we have and we’re not going to recruit …,’” said Pete Miller, board chairman of Transocean.
Miller said it’s a company’s “fiduciary responsibility” to make sure they keep the training programs and keep the vibrancy of their organization.
“It’s not easy. I’d be lying if I said it was, but you have to keep your eye on that and make sure you’re continuing to bring in a pipeline of younger individuals.”
Lorenzo Simonelli, president and CEO of GE Oil and Gas, noted that it would be a challenge, but extremely important to make sure the company protects its recruitment programs and stays populated in workers to fill the ranks, specifically with a large number of workers preparing to retire.
Taking cues from the past, Royal Dutch Shell has put measures in place to mitigate the down cycle, said Wael Sawan, Shell’s executive vice president for deepwater. For example, the company is investing in its training center in Louisiana to reduce time to employ from two-and-a-half years to just under 10 months.
“It doesn’t mean we can compensate for three decades of experience, but it allows us to move faster than many companies have done in the past,” Sawan said.
Panelists also encouraged young engineers not to get discouraged by the seemingly lack of potential jobs currently.
Noted Simonelli, “in this industry climate, take the internship. Take the training program. Get your foot in the door. You’ll notice in 12 months’ time – things change very quickly in this industry – don’t shy away from the industry just because it’s a tough time. We still need graduates.”
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