Low oil prices being bad news, seeing the transition to low-carbon as a particular challenge and a perception that the industry is not attractive to young people are “myths”, according to BP’s upstream boss.
Bernard Looney has been speaking in London, taking on what he sees as misconceptions about the sector.
On oil price, he acknowledged that the drop has caused “a lot of pain” in “oil towns from Aberdeen to Luanda and Baku to Houston”.
However, he added that three years of the price rarely going above $70 a barrel has been good news for customers and innovation in the industry.
“It has forced us to confront inflation and waste. Those issues were obscured in a $100 world, but they were brutally exposed in a $50 one.
“We face a choice between evolution and irrelevance – and we are evolving. We have embedded new levels of capital discipline in projects and new levels of efficiency in operations. We have not just applied new technology, but the newest technology, and not just from our industry.”
He said that BP’s upstream are driving efficiency through adaptability and digital innovation.
“I think we need to realise the full potential of technology to support safety. We can reduce a lot of risks to people by using drones, crawlers and robots.
“The second point is that the combined impact of supercomputing and artificial intelligence is helping us see our world through new eyes. We can uncover resources. We can compare wells instantly. We can pinpoint corrosion risks by applying machine learning to 40 years’ worth of data. Who would have thought 10 years ago that Upstream folks would come to conferences like this to compare algorithms and petaflops?
“This is major change and I am not sure we would have moved so far and so fast without the urgency created by the 2014 crash.”
“The notion that millennials see this as a sunset industry. . .I’m a little more optimistic.”
On moving to low-carbon, he conceded that the move will be a challenge, “but the big picture is a sustainable environment. A positive outcome for humanity. This is something for everyone to support.”
He added that, in BP’s energy outlook published on Tuesday, even in the fastest transition the world would still get 40% of its energy from oil and gas in the year 2040.
On Mr Looney’s final point, he rejected the concept that young people view the industry as one in decline.
“Let me take on the notion that the industry is sitting on a demographic timebomb because baby-boomers are retiring and millennials see this as a sunset industry.
“I’m a little more optimistic.
“First, if the world is going to get 40% or more of its energy from oil and gas in 2040, then there’s a career in energy for today or tomorrow’s graduate or apprentice.
“Second, that career can go beyond oil and gas as the transition unfolds – into wind, or solar, or carbon capture, or vehicle charging. What could be more rewarding than to help steer the world through this unique period of transition? If you want to make a difference, it’s hard to think of a bigger one.
“Third, new technology is providing opportunities for a new generation of skills from artificial intelligence to bioscience, materials to robotics.
“We will always face challenges, but those of the last few years have been good for us and prepared us for a new road ahead.
“It is a road where we should not question progress, but lead it. Our industry led the world into the age of affordable energy. Now it is time to lead the world into the age of sustainable energy.