Nicholas Newman is an Oxford based journalist, blogger, editor, and consultant that covers a range of topics in the global energy, technology, and transport sectors as they apply to extraction, markets, regulation, fiscal and policy sectors.
One thing is clear: the oil and gas industry is facing a skills gap in every aspect of the business, including drilling specialists, subsea specialists, health and safety specialists, project engineers, and geoscientists.
To tackle this skills shortage problem, the industry is applying the latest innovative technologies. These include investments in artificial intelligence (AI), industrial internet of things (IIoT), and automation. The industry is also considering remote support technologies designed to partially solve the recruitment problem.
There are several reasons for a skills gap in the industry, according to a recent Global Energy Talent Index (GETI) 2019 report. These included the past redundancies caused by the downturn of the industry in 2016, resulting in the North Sea losing 120,000 jobs. This led to subsequent reductions in graduate recruitment and apprenticeships vacancies. Also, current workers see growing industries such as technology and renewables as potential employment opportunities.
The report forecasts that in the next few years these recruitment problems are likely to worsen. The report surveyed 17, 000 industry professionals where at least 40% of respondents felt a recruitment crisis had already hit the sector. 28% of respondents are expecting the crisis to take hold in the next five years.
For example, the North Sea oil and gas industry will need to recruit around 25,000 people over the next six years. This includes 4,500 to do jobs that do not yet exist. The OGUK workforce Report 2019 said that the total number of people employed in the industry will fall by 15,000 by 2025 as fields run dry and more tasks are automated.
There are several reasons why there is a skills shortage; in part, it is a demographic, image, gender, and digital issue. In the case of demographics, according to the 2019 Global Energy Talent Index, the industry workforce is getting older; at least 18% of the workforce is over 55 years old. While only 4% are under the age of 25. This means there are not enough young people being recruited to replace the staff destined for retirement.
Also, currently, 90% of workers in the industry are men – a very visible difference. As the industry and its workforce requirements evolve, it’s no longer viable for oil and gas companies to depend on predominantly male talent to meet demand.
Finally, the arrival of new technologies such as automation, artificial intelligence, and the Industrial Internet of Things is changing how the industry works and operates. Because of this, we are seeing new types of jobs with job descriptions, duties, and responsibilities that did not exist for a few years. Unfortunately, many of the people with such skill sets are equally in high demand in other sectors of the economy.
Then there is an image problem. According to the 2019 GETI report, fewer millennials are choosing the oil and gas sector. In fact, it was the number-one industry millennials wished to avoid working in because of its poor public image.
Many millennials regard the oil and gas sector as a sunset industry. Millennials believe the industry lacks opportunities to undertake purposeful work, as well as innovation and agility. Such aspirations are major drivers of career selection amongst this age group. According to The Talent Well, only 2% of US college graduates consider the oil and gas industry their top choice for employment.
Increasingly, we are seeing the oil and gas sector, applying internet of things technology to help tackle the skills gap. The industry makes use of internet of things connected sensors that monitor and manage equipment at a distance. This helps reduce the need for skilled workers. For example, we are increasingly seeing every bit of equipment on an oil rig equipped with a sensor net. The data collected is transmitted to a central control room. This is where every aspect of the condition of the rig is monitored, evaluated, and managed. Due to advances in technology, a management center could be in Houston. The team of experts there could be providing remote support of rigs all over the world.
Due to the application of the industrial internet of things technology the workforce on rigs is declining. This is due to the increasing usage of automation and artificial intelligence. For example, a North Sea oil rig that needed a crew of 100 a decade ago now has a crew of 10. In fact, some are crewed during the day only.
Now, an increasing number of onshore rigs are becoming unmanned. The first automated unmanned rig is remotely supported using internet of things technologies, to manage the facility in real-time. The rig came online in October 2018 in the North Sea by Norwegian energy giant Equinor, previously known as Statoil. The Oseberg H rig costs £606m and has no living quarters or even a toilet on it. It is entirely unmanned, only needing one or two maintenance visits a year. It is also the first fully automated oil and gas platform.
Meanwhile, offshore support vessels supplying cargo to offshore rigs of the future will be automated. Because, the world’s first automated remotely supported container ship, the Yara Birkeland, is due to begin work in 2020. The introduction of human-controlled automated ships is likely to significantly cut operational costs. Since around 90% of operational costs come from wages.
Using a similar set of technologies, the industry is increasingly making use of augmented reality to visualize data and analytics in real-time for operators, both distant offshore production facilities and onshore experts.
The DNV GL report "Digitalization and the Future of Energy" surveyed nearly 2,000 engineers and senior executives from start-ups to large corporations in the energy sector. The report mentioned the need for digital skills training. Data science and big data analytics are also the most important digital skillsets. 65% of organizations need employees with creative problem-solving competence in their workforce.
Nicholas Newman is an Oxford based journalist, blogger, editor, and consultant that covers a range of topics in the global energy, technology, and transport sectors as they apply to extraction, markets, regulation, fiscal and policy sectors.
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