It used to be that the great crew change, and the associated loss of experience, was the major challenge facing the oil and gas industry.
However, the onset of this phenomenon has been overshadowed by job losses resulting from the current downturn. It’s impossible to gauge just how much historical knowledge has been lost over the last 24 months and it’s too early to tell what impact this will have on the oil and gas industry in the long term.
The industry is under pressure to reduce costs at a time when it is cash poor and also needs to be increasingly innovative in order to extract difficult to reach oil and gas reserves. Not an easy task when lifting costs need to be kept as low as possible in order for companies to make a profit or, in some cases, break even.
All this comes at a time when the political outlook is increasingly unpredictable and when climate change is ever high on the agenda and the COP21 initiative is driving us to keep global warming below 2oC. Change for the better is needed if the industry is to avoid spiralling into decline.
Disruption is key to effecting change. American author and blogger Seth Godin advocates that if you want things to change you have to ‘hire and train people to do the paradoxical, to discover that the unfamiliar is the comfortable familiar they seek’.
This approach resonates with the recommendations from the recent PWC report, ‘A Sea Change’. This report looked at what needs to be done to secure a sustainable future for the oil and gas industry. It suggested that the oil and gas industry needs ‘a dominant leading figure’, possibly from a different sector, in order to ‘shakeup inefficient, older-thinking of the existing regime’; that the industry ‘needs disruption and change at the same time as recognising the benefit of existing wisdom and experience’.
This makes sense. The current ways of working and leadership are ingrained but if you always do what you have always done, then you can’t be surprised when nothing changes. We, as an industry need to ensure that this cycle does not continue, that mistakes are not repeated as the industry goes through this current transformation.
We do not want to be left ill prepared for an ever more challenging future, rather we need to embrace and effect change to, as a minimum, deliver a sustainable solution for the continued existence of the oil and gas industry in the North Sea.
But in reality the end goal should be to ensure that the North Sea continues to be celebrated as a centre of excellence within the oil and gas industry; that it is a hub of innovation, that techniques and technologies developed here continue to be applied around the world and across the broader energy industry.
More than 30 senior stakeholders from the UK, the Netherlands and Norway, from across the value chain in the North Sea, were interviewed for the ‘A Sea Change’ report.
Martin Worth is commercial director at Plant Integrity Management
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