TPT September 2016

G LOBA L MARKE T P L AC E

When the United States reaches full employment, oilfield services companies and drillers could face a shor tage of workers “I don’t see how the [US oil] industry comes back to any level of activity that is busy without a breakneck amount of chasing bodies, and there just aren’t going to be enough to go around.” The speaker was Jeff Bush, president at Denver-based CSI Recruiting. The “bodies” to be chased are the many oilfield workers who, as Mr Bush told the business news TV channel CNBC , will not be easy to round up when the current boom- and-bust cycle in the industry has run its course. Government data released in July showed the US added a whopping 287,000 jobs in June, and the nation’s unemployment rate held below 5 per cent. The question, according to CNBC’s Tom DiChristopher, is whether workers flushed out of the industry and into a resurgent US labour market will head back to the oil patch. Mr DiChristopher observed that recruiters have long warned that layoffs could come back “to haunt an industry still dealing with a shortage of mid-career workers following the 1980s oil bust.” It is no minor concern. Current projections indicate that the US oil industry will need to hire tens of thousands of workers over the next two and a half years as oil prices recover and drillers stand up rigs. (“Oil and Gas Industry Could Hire 100,000 Workers – If It Can Find Them,” 8 July ) The recruitment agency Airswift told CNBC that an estimated 291,500 energy jobs have been lost worldwide since the start of the oil price downturn in 2014. And Janette Marx, the Airswift chief operating officer, said that – once demand for skilled staff returns – employers should anticipate a significant increase in the cost of attracting and retaining talent. › While Goldman Sachs stands by its own estimate that US energy companies will need to attract 80,000 to 100,000 employees, the investment bank believes that high pay in the oil and gas industry will facilitate the effort. Central to Goldman’s thinking is its belief that many oilfield services companies have retained experienced staff in lower-rank positions throughout the wave of layoffs, ready to resume their former jobs when oil prices recover and activity ramps up. These “banked” and restored employees would thereupon preserve and build upon the efficiency gains achieved during the downturn. Gladney Darroh, president of the Houston-based energy recruiting firm Piper-Morgan Associates, is strongly sceptical of the Goldman conviction that re-staffing will not be a problem, and that hiring and training will be confined to the lowest skill levels. “This whole idea that we’ve got this whole group we have sort of demoted for the time being that are still in the organisation that we can quickly promote back up?” Mr Darroh told CNBC, “That’s a fairy tale.” › Since the layoffs in the industry seem to have peaked, we may not have to wait long to learn which view prevails. Mr DiChristopher noted that, on 7 July, the Chicago-based outplacement firm Challenger, Gray & Christmas reported that US-based energy sector employers cut 42 per cent fewer jobs in the April-June period than in the first quarter.

Monitoring of Europe’s gas and oil pipelines gets an assist from data collected by surveillance satellite The European Space Agency, a Paris-based intergovernmen- tal organisation with 22 member states, is dedicated to the exploration of space. But a recent ESA report was informed by some decidedly ground-level findings on pipeline inspection. Worldwide, gas and oil pipelines extend 1.24 million miles. Within the countries of the European Union, gas pipes stretch 86,992 miles, while an additional 24,858 miles of pipe carry oil and related products. Final distribution lines service homes and workplaces. In the main this network is not very deep, lying some five feet underground. According to the ESA, which furnished this information, in Europe almost half of all failures in high-pressure gas transmission pipelines can be traced to excavations, construction work and deep ploughing. Aerial inspections conducted at three-week intervals enable operators to identify 17 per cent of the problems presenting along the pipeline route. The public, with a 37 per cent detection rate, does better. But more consistent and reliable troubleshooting would obviously be beneficial. Through its Integrated Applications Promotions programme, the ESA helps companies to develop and deploy new space-based services in an operational setting. This spring, the organisation announced one such initiative: a system, from the Dutch startup Orbital Eye, that uses radar images from satellites in combination with smart software to detect suspicious activity in the vicinity of oil and gas pipelines, including the slightest ground movement. (“Monitoring Pipelines from Space,” 6 June) By means of a tablet app, the pipeline operator alerted to a potential threat can then dispatch field personnel to the site. With a connection to a central database via terrestrial networks and satcoms, the app is functional even in desert areas and other remote locations. Orbital Eye avails itself of the EU’s Copernicus programme with its growing constellation of Sentinel satellites, which provide free high-quality observation data, day and night, independent of weather conditions. Sentinel-1B, launched in April, is expected to allow for wider coverage – to regions of Asia, Africa and the US – thus enabling Orbital Eye to extend its reach. The ESA reported that a major African pipeline operator has already signed up for the company’s service. Elsewhere in oil and gas . . . › On 8 July, with its largest storage facility, Rough, not yet back in service after a 42-day outage, the UK gas system operator said Britain’s heating requirements for the winter would be handily met from a variety of sources. According to National Grid, its own available supply of 605 MMSCFD (million standard cubic feet per day) will be supplemented by natural gas imports from Norway, expected to increase from October to March by as much as 18 per cent from a year earlier. Supplies of Dutch and Belgian fuel, as well as LNG imports, are also expected to increase.

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S EPTEMBER 2016