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The elusive brain drain in oil and gas

08-05-2011 08:56 AM CET | Energy & Environment

Press release from: Arc Media Global

SINGAPORE (5 Aug 2011) – 2011 marks intensified recruitment targets for oil and gas companies globally. The war for talent is on for hard-to-find petrotechnical professionals (PTPs) and the pressure is on to develop hard-to-retain operations people. With the generation of geoscientists and petroleum engineers hired before the deep recruitment cuts of the mid-1980s approaching retirement, new talent distribution now centred on Asia and Russia and changes in gender ratios, companies will need to adapt their recruitment to the new distribution of talent worldwide.

Over the past five years, oil and gas companies’ portfolios have shifted towards ever more hostile, extreme environments in search of reserves, intensifying recruitment for talent with highly specialised expertise. Deepwater projects are being subject to stricter regulations which may spread beyond deepwater operations. Technology is critical to deepwater drilling success and to the development of unconventional oil and gas resources.

A survey released by technology provider, Schlumberger shows that recruitment targets for technical staff in 2011 are 15% higher than levels planned in 2009, demand for graduates is recovering and outpacing the pessimistic forecasts of a year ago and national oil companies (NOCs), independents and majors all plan to intensify recruitment efforts from 2011 onwards.

This statistics strongly resonates on the ground. In an interview, a capability manager in one international oil and gas company said, “The concept of capacity and skill pooling is very timely and attractive. Nowadays, some of my HR friends are facing the same problems as I am: It is difficult to find the best talent due to talent war is very aggressive today. They cannot resist “resignation wave” from the employees due to many things such as unhappiness with the compensation system, career ‘stuck’ situation or even unhappiness with their bosses. They face internal dilemma between the “X” generation and “Y” generation regarding the transfer of skill, knowledge and even corporate culture. This whole process is destroying step-by-step the company capacity which has a big impact on the company productivity and company adaptability.”

“We spend years to find that big discovery, but only have days to get the right skill pool? Got oil, no people–that’s where we are now.”

As the recruitment targets for PTPs in mid-career soar, with NOCs and majors reporting the highest rates of increase, the labor market for experienced PTPs will be tight over the next three years, resulting in the poaching of staff, salary escalation and higher attrition rates. These staffing issues will have serious consequences on projects and production capacity. Companies contributing to the 2010 survey reported that staffing issues will delay projects and may drive decision makers to take more risk.

Along with the shortage of experienced PTPs in the coming years, companies will need to adapt even more quickly than before to manage talent pools, accommodate growth and changes to the regulatory environment and avoid the risk of losing competitive advantage.

“Training and retaining tacit knowledge from the retirees is often a challenge but there are ways to get it,” a capability development expert quipped. “The way to solve this problem is to effectively manage the younger generation to achieve autonomy level quicker.”

The greater challenge however is not really about the age of the talent, but the fact that the problems in highly complex operations require unstructured strategic decisions, which can only made through richness and wealth of interdisciplinary experience. However, experts from these specific departments do not talk. “We may have tools to sustain production and link disciplines together, but when your experienced people leave or retire, the problem goes back in a second,” another technology provider added.

With the resurgence of Southeast Asia’s oil and gas industry, we need to ask:

• How robust is your mentorship programme and how do you set this up effectively?
• How do you empower youths to exceed KPIs and reduce time to autonomy?
• Are we ready for the big crew change when most of our experienced technical experts retire?
• What are the industry’s HR leaders’ initiatives to ensure the same mistakes are not repeated and make oil and gas industry attractive?
• How do we capture knowledge and increase our intelligence density?

The Capability Development and Skill Pooling for Oil & Gas Forum (18 October 2011, Kuala Lumpur, Malaysia) will convene respected capability development, training and HR leaders in the oil and gas industry to discuss ways to attract talent, reduce time to autonomy and capture knowledge to maintain your competitive advantage. Visit for more info.

Be at the congress and benefit from strategies that will enable you to:

• Predict, manage and expedite operations within various contested boundaries of oil and gas reserves
• Strengthen ties with other parties whilst protecting national/company interests through effective negotiations
• Effectively operate in various fiscal and regulatory regimes by drafting a clear and mutually beneficial legal framework for successful JPDA/JDAs

The Center for Energy Sustainability and Economics (Center for Energy) is an industry research centre (IRC) that works to bring top executives together in communities of learning and practice to act as a catalyst for generating high-value energy business insight and channel top expertise to where the world needs it most. Meetings by the Center for Energy are managed by Arc Media Global, the world’s first B2B/G2B integrated marketing specialist headquartered in Singapore.

Robinson Road P.O. Box 176, Singapore 900326

Contact: Eunice Wee
Arc Media Global
(+65) 6844 2080

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