The Great Crew Change

The professional workforce in the hydrocarbon industry is aging and over half of today's workforce will retire within the next 10 years. This ‘brain gap' must be addressed before it is too late.
This article appeared in Vol. 6, No. 2 - 2009


Invited speakers for the Workforce Forum at the AAPG conference in Cape Town in October 2008 were Rod Nelson, VP Innovations and Collaboration, Schlumberger; Christian J. Heine, Senior Geological Consultant, Saudi Aramco; Mario Carminatti, Executive Manager, Exploration, Petrobras; Jatinder Peters, General Manager Administration and HR, ONGC; Pete Stark, VP of Industry Relations, IHS (Co-Chair); Michael Naylor, VP Exploration Technical Shell (Co-Chair) and Scott Tinker, AAPG President. Photo: AAPG "In 2000, the peak age of members of SPE was 43. By 2006 it had risen to 50. Projected forward to 2012, it will be 60 - in other words, a large percentage of the workforce will be retiring. Where will we find the knowledge base and skills to keep us driving forward? This is the most serious issue facing the industry today."  

This is how Pete Stark, VP Industry Relations for IHS, summed up the situation at an open discussion on the topic of the aging professional workforce, at the AAPG Meeting in Cape Town last October. The panellists at the forum were senior managers from a range of organisations, including NOCs, major oil companies, service companies and academe, all of whom recognise the seriousness of the situation and who had some interesting insights and suggestions towards some solutions.  

The forum concluded that the issues and the solutions to this can be summarised under the ‘5Rs': reputation, recruit, retain, re-equip and redistribute.

Enhance our reputation

The numbers of geoscientists in Brazilian NOC Petrobras declined in the 1990’s with few recruited for 10 years. As a result, geoscientists in the company either have less than 10 years experience or more than 20, and it is imperative to capture the knowledge from this last group before they retire. Image: Petrobras/Sistema de Gestão de Pessoas Dr. Michael Naylor, VP Exploration Technical with Shell, pointed out that the hydrocarbon industry does not have a sufficiently favourable image in the media, and believes that enhancing this reputation is imperative to attract the most capable students. "It is important to involve all parties involved in the industry, from oil companies to government, academe and the professional societies," he says. "Stronger industry - academe links are key, not just in targeting graduate recruits but also in supporting R&D, scholarships and professional programmes."  

Another panellist, 2009 AAPG President Scott Tinker, concurred, suggesting that government, industry and academe must work together to create a stable environment which attracts and retains the best talent in the world. As he pointed out, "complex global issues pose technological and social challenges requiring an integrated approach, but each sector has different time scales for decision making, and is motivated by different opportunities."  

Representing the Indian national oil company, ONGC, Jatinder Peters also agreed that the perception of the industry could hinder it from acquiring the best candidates. "It is seen as a tough and hard industry, and the career prospects are not highlighted satisfactorily," she said. "Governments can help by improving policies to make them sensitive to industry issues. They can play an active role in industry academia interactions and help develop the required infrastructure."

Recruit the right candidates

So how should the industry fill the empty pipeline with new recruits? "Attracting and retaining young scientists is essential for our future and requires innovative thinking," Rod Nelson, VP Innovations and Collaboration with Schlumberger, preaches. "Recruiting and training have rapidly accelerated since 2004, and in theory the new technical graduate supply is sufficient. But are they the right people?" As Christian Heine from Saudi Aramco summarised the recruitment challenge: "Employability is the issue."  

Jatinder Peters concurs with this. "There is a huge mismatch between the skills needed for industry and the output from universities. We need specialists, but we are getting generalists. In addition to technical expertise, the new breed of geoscientist needs adaptability, good communication skills, financial and commercial knowledge, a global outlook, and cultural, social and religious sensitivities. Feedback from industry indicates dissatisfaction about the employability of graduates, and this must be addressed through cooperation."  

She suggests the industry should have more interaction with students, from site visits and training days through to scholarships and apprenticeships, even the adoption of colleges and schools by oil companies. For their part, academic institutions should add more petroleum-related courses to the curriculum, and establish feedback mechanisms from industry, so that additional and more relevant R&D is undertaken. "Industry professional groups such as the AAPG have a role in generating awareness, by developing student chapters, creating awards and competitions, and providing a platform for students to interact with professionals."  

Mario Carminatti, Petrobras Executive Manager, Exploration, said that his company has been quite successful in helping universities keep students to completion of their studies, through investing and supporting university research projects, and providing grants and scholarships. As a result, they have a regular and successful admission programme with high quality students from these establishments. He also pointed out that Petrobras is the largest geoscience employer in Brazil, and has the reputation of being a company that cares for its employees and offers them the chance of a life-long career.  

Inspire youngsters

There is a serious shortage of trained geoscientists in some parts of the world and a deficit in others. Source: 2005 Schlumberger Business Consulting study Mike Naylor insists that technical excellence will remain a necessity. "Even with the increasingly sophisticated array of tools available, the geoscientist of the future will still find that a good grasp of the fundamentals of geology and geophysics, and the ability understand petroleum systems will continue to be paramount. There will be no place for unconnected isolated specialities, and technical outputs will feed seamlessly into business decision-making and operational execution."  

"We have to remember that, as far as recruitment is concerned, we are all effectively ‘fishing in the same pond'," he continued. "Instead of trying to outsmart one another, companies should cooperate in seeking longer-term solutions and growing the size of the available resource pool." A contributor from the floor said that in Australia, for example, only 10% of schools offer geology or earth sciences at High School level and that this is the age at which we need to be inspiring youngsters. He also pointed out that it may be up to 10 years before this inspired teenager is a productive petroleum professional.

Retain key staff

Scott Tinker is Director of the Bureau for Economic Geology at the University of Texas at Austin and is this year’s AAPG President. He spent 17 years in the oil and gas industry in exploration, production and research prior to coming to the university in 2000. Photo: AAPG While attracting the right new recruits to the industry is important, it is imperative that companies retain their existing workforce, in particular managing the ‘7 year itch' and reversing the trend of decreasing numbers of women following a full career in energy geoscience.  

Jatinder Peters pointed out that features which used to be important in a career are no longer significant. "People no longer seek job security, but employability security," she said. "Longitudinal career paths have been overtaken by alternative career paths, organizational loyalty by job or task loyalty. A good work/life/family balance is now as crucial as career success, and continuous learning is as important as an academic qualification. Today's employees no longer expect to spend their life in the same company, or even in the same career. The industry must adapt to these new career paradigms."  

From presentations made at the forum, it would appear that the NOC's have been more successful at retaining key staff than the majors. Mario Carminatti said that Petrobras offers incentives to critical employees to encourage them to postpone retirement. It maintains a strong link between technological development and intensive training, and offers a challenging and friendly working environment. "Petrobras is a significant national symbol of Brazil development, so people want to work for the company," he concluded. Both Mario and Jatinder said that for the NOC's benefits such as medical assistance, retirement plans, and family educational support are a very important feature.  

Several speakers emphasised the importance of recruiting and retaining female employees; the percentage of female AAPG members has not increased dramatically over the past 30 years, despite the fact that the percentage of US women geoscience graduates increased from 25% in 1988 to 45% of total geoscience graduates in 2007. Suggestions to reverse the trend of decreasing numbers of women following a full career in energy sciences included a more flexible approach to the work-life balance and efforts to help employees maintain a science edge in any "part time" years.

Re-equip and empower

An aging workforce in developed nations will lead to a ‘brain gap’ in the industry in the next 10 years, but with planning and cooperation the developing nations can fill this. Source: UN website/Scott Tinker Oil companies must re-equip their geoscientists with the knowledge needed to find hydrocarbons in the modern world. Petrobras, for example, is now one of the fastest growing companies in the business, but during the 90's they did not recruit any geoscientists; in fact the number employed fell by more than 16%. "42% of our geologists and geophysicists have less than five years experience, so we have a substantial ‘brain gap'," explained Dr. Mario Carminatti. "We are countering this by increasing the number of senior geoscientists and even retired professionals who operate as mentors to the younger generation."  
All the speakers agreed that managing knowledge transfer and encouraging autonomous decision-making, particularly through mentoring by older, experienced staff, fills a crucial role. "Systematic mentoring by senior professionals is a cornerstone in graduate development," said Mike Naylor. "Individual experience will be substantially augmented by capturing organisational experience. Both are vital, but through proper use of knowledge bases and personal networks, we can accelerate the pace at which new recruits build and apply their experience."  

The effective use of both mentors and training programmes were stressed by Aramco, which still requires some foreign staff, but which is rapidly building up its local competence and anticipates a major increase in manpower over the next few years. "Companies need long term structured development programmes, to re-skill staff in disciplines which are in high demand, such as carbonate reservoirs and new technologies. New training methods and approaches, like simulation, augmented reality and web-based learning, all have a part to play".

Redistribute globally

As everyone knows, there is a huge demographic difference between developed and developing nations, the latter with 50% of their population under the age of 25. It therefore makes sense for some of the work now done in developed nations to be undertaken in countries or regions with resource surpluses. As Jatinder Peters explained, "Human resources are India's biggest asset, providing us with a unique competitive advantage, but to capitalise on this, we must ensure our people have the educational, language and other appropriate skill-sets required."  

"Global demographics are evolving, and talent is the fundamental priority," summarised Scott Tinker.  

Mike Naylor suggested that further emphasis should be placed on the ‘digital highway' to offer more flexible work opportunities and easier cooperation across borders. "Companies will feel different!" he predicted. "Staff will be ethnically diverse, increasingly coming from outside Western Europe and North America. Some will be based in existing centralised locations, others in new centres in the Middle East and Asia, such as Shell's technology centre in Bangalore. Yet more may work remotely in virtual teams, capitalising on the bandwidths now available."

Lessons to be learnt

As Christian Heine said, "there's a lesson to be learnt here, it's easy to cut things, harder to get them back again." However, all agreed that progress is being made and many companies and organisations are pointing the way to resolving these issues.  

All the speakers, both panel and floor, considered that fossil fuels will continue to have a high profile, and although technology will develop, it will complement fundamental geoscience skills, not replace them. Even as new technologies emerge, the plays and prospects are getting more challenging.  

There was a strong consensus that science, policy and commercialization are critical partners for the future and that without working with the universities to create more structured, career-oriented courses, taught by people with knowledge and understanding of the industry, progress will be slow.  

The challenges remain as exciting as ever. "The future workforce of the industry will be technically excellent, knowledgeable and networked, cross-disciplinary, technologically adept and geographically diverse - an excellent value proposition," said Mike Naylor. But he sounds a note of warning to the complacent. "Good people are mobile and will select only those companies offering the best. The best working environments and tools, development opportunities and job challenges and the best leaders - with not only business understanding and intellect, but able to connect with, engage and motivate their people.  

A speaker from the floor agreed, aptly summarising the future workforce. "These people are ambitious, IT savvy and good at social networking. Geoscience is at the core of our industry, that won't change, and it needs creativity, enthusiasm and passion. But you can't teach passion. We must find out what attracts and enthuses the upcoming generation, and adapt the business to them."


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