YPs GUIDE TO THE HAGUE, NETHERLANDS | INTERVIEW WITH BPs BOB DUDLEY | SOCIAL MEDIA AS A CAREER

The Magazine by and for Young Professionals in Oil and Gas

VOLUME 10 // ISSUE 3 // 2014

T E N T H A N N I V E R SA RY ISSU E

An Official Publication of

the Society of Petroleum

Engineers [Link]

Contents

VOLUME 10 // ISSUE 3 // 2014

Americas Office
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Whats Ahead

TWA InterAct

TWA Interview

HR Discussion

Inspiring words from David Vaucher in his final issue at TWAs helm.

You are the energy sector! How to tell others what its all about. And more!

Bob Dudley, BPs chief executive, talks about his career and what its like
leading one of the industrys most talked-about companies.

Recruitment trends and talent managementa 10-year panoramic view.

10

Forum

13

Economists Corner

17

Pillars of the Industry

Ten life lessons to help you excelnow and for the rest of your career.

The past technology-driven decade and the economic challenges ahead.

Vivek Sharma, well engineering services manager, Halliburton Consulting

Asia Pacific region, gives insight into his career and the industrys future.

Canada Office
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Calgary, AB T2P 3T3 Canada
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19

SPE 101

20

Discover a Career

Europe, Russia, Caspian, and Sub-Saharan Africa Office

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First Floor, Threeways House, 40/44 Clipstone Street
London W1W 5DW UK
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23

Technical Leaders

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26

Soft Skills

29

Tech 101

32

YP Newsflash

34

A YPs Guide to...

37

Academia

39

Congratulations, TWA!

40

Your Best Shot

Middle East, North Africa, and South Asia Office

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Moscow Office
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Follow SPEs growth and change during The Way Aheads first decade.

What is it like to be an oil and gas social media professional? According to

Olivia Harting and Erika Conner, social media leaders at Chevron, its fastpaced, complex, challenging, global, and requires constant learning.

The past and future decade: Industry leaders Eve Sprunt and Luis
Rodriguez speak their minds on a host of industry topics.

Is the industry ready for a change in leadership? You may be part of it!

The authors tell you how hydraulic submersible pumps work and how
theyre different from other types of artificial lift.

YPCC update. And news from SPEs Bahrain, Turkey, and Mumbai sections.

A center for peace, hope, diplomacyand oil and gas: The Hague, Netherlands.

How to understand the complexities of unconventional reservoirs.

2005 SPE President Giovanni Paccaloni helped nurture TWAs beginnings

and couldnt be prouder of all The Way Ahead has achieved. Long life, TWA!

Beautiful oil and gas images from Wei-Lin Fan and Elizabeth Reale.

An Official Publication of
the Society of Petroleum Engineers [Link]
Printed in UK. Copyright 2014, Society of Petroleum Engineers.

TWA EDITORIAL
COMMITTEE
EDITOR-IN- CHIEF
David Vaucher, IHS

DE PU T Y E DI TOR-I N- CHIE F
Tony Fernandez, Jefferies LLC

TWA A DV I SOR
Todd Willis, Chevron

LEAD EDITORS
Amber Sturrock, Chevron
Angela Dang, Colorado School of Mines
Harshad Dixit, Halliburton
Henny Gunawan, Schlumberger
Islin Munisteri, BP
Jenny Cronlund, BP
Madhavi Jadhav, Schlumberger
Maxim Kotenev, CGG Veritas
Paulo Pires, Petrobras
Prakash Deore, Fujitsu Consulting

TWA STAFF

ADVERTISING SALES

Glenda Smith, Publisher

AMERICAS

John Donnelly, Director, Magazines and

Web Content

10777 Westheimer Rd., Suite 1075

Houston, Texas 77042-3455
Main Tel: +1.713.779.9595 Fax: +1.713.779.4220

Robin Beckwith, Senior Editor

Craig W. Moritz
Assistant Director Americas Sales & Exhibits
Tel: +1.713.457.6888 cmoritz@[Link]

Alex Asfar, Senior Manager Publishing

Services
Craig Moritz, Assistant Director
Americas Sales & Exhibits
Mary Jane Touchstone, Print Publishing
Manager

Evan Carthey
(Companies AL), Sales Manager Advertising
Tel: +1.713.457.6828 ecarthey@[Link]
Dana Griffin
(Companies MZ), Advertising Sales
Tel: +1.713.457.6857 dgriffin@[Link]
CANADA

Stacey Maloney, Print Publishing

Specialist

Mark Hoekstra, Sales ManagerCanada

Tel: +1.403.930.5471 Fax: +1.403.930.5470
mhoekstra@[Link]

Laurie Sailsbury, Composition

Specialist Supervisor

EUROPE AND SUB-SAHARAN AFRICA/

MIDDLE EAST, ASIA, AND AFRICA

Allan Jones, Graphic Designer

Rob Tomblin, Advertising Sales Manager

Tel: +44.20.7299.3300 Fax: +44.20.7299.3309
rtomblin@[Link]

Anjana Narayanan, Copyeditor

Rita Okoroafor, Schlumberger

Rob Jackson, Mountaineer Keystone
Shruti Jahagirdar, Shell Technology India
Siluni Wickramathilaka, ConocoPhillips
Subhash Ayirala, Saudi Aramco

EDITORS

Celebrating 10 Years
of Fresh Energy &
Creative Ideas!

Anisha Mule, Larsen & Toubro

Ankit Agarwal, Schlumberger
Asif Zafar, Halliburton
David Sturgess, Woodside Energy
Dilyara Iskakova, Hess
Hao Sun, Chevron

TENTH ANNIVERSARY ISSUE

Islam Ibrahim, GUPCO

Jakob Roth, Schlumberger
James Lloyd, Mayer Brown LLP
Kristin Weyand, ConocoPhillips
Muhammad Taha, NED University
Oyebisi Oladeji, Schlumberger
Thresia Nurhayati, Halliburton

ADDRESS CHANGE: Contact Customer Service at 1.972.9393 to notify of address change or make changes online
at [Link].
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Subscriptions are USD 15 per year for other SPE members, and USD 45 per year for nonmembers.

TWA THE WAY AHEAD (ISSN 2224-4522) is published three times a year (February, June, October) by the Society of
Petroleum Engineers, 222 Palisades Creek Drive, Richardson, TX 75080 USA.

ASSOCIATE EDITORS
Amanpreet Gill, Nexen
Batool Haider, Stanford
Carter Clemens, BP
Dane Gregoris, GLJ Petroleum Consultants
Ivo Foianini, Halliburton
Matt Hale, Baker Hughes
Matthew French, ConocoPhillips
Nazneed Ahmed, Apache
Shubham Sharma, Indian School of
Mines Dhanbad

SPE Publications: SPE is not responsible for any statement made or opinions expressed in its publications.
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Whats AheadFrom TWAs Editor-in-Chief

10 Years: One Whole Decade

David Vaucher
Editor-in-Chief
The Way A head

hat were you doing 10 years ago? If you are among

todays youngest TWA readers, you probably werent
older than 8. There was no iPhone, no Twitter, and WTI
crude was in the USD-30-to-USD-50/bbl [Link] world was
different then, and so were you.
In 2004, I was 20 years old, still a mechanical engineering
student at Rice Universityand loving it.
Now I am 30. I graduated not only from college but also
graduate school (twice). I switched jobs a few times before
finding the great opportunities I have where I am now. The girl
I dated in college is married (not to me). I am about 25 pounds
heavier (all muscle, really!). And my goals, aspirations, and
skills changed dramatically for the better.
10 years: One whole decade. It is a long time. And yet the
fact that I can remember my college years like they were
yesterday shows how fast time appears to move forwardwith
no stops, no pauses, no time to catch your breath.
Looked at one way, it is terrifying: It is not such a leap to
imagine that since I seemed to experience the past 10 years in
an instant, the time between when Im 30 and when Im 40 will
appear to go by just as quicklymaybe even faster. What if I
dont achieve everything I have set out to do?
Seen another way, it is highly motivating: I think of
everything I have done and accomplished in the last 10 years
some of which I never would have predictedand I think Yeah,
things worked out pretty well actually, and theres no reason to
think the next 10 years wont be just aseventful.
The fun thing about the future is that it is always a surprise:
You can plan all you want, but most of the time you just have to
roll with whatever comes your way. But dont believe you can
just sit back and wait for success and prosperity to come to you.
Time marches on, and there is nothing anyone can do about
that. However, we can exert some measure of control over how
we feel when a decade-long period of time ends.
The daily struggles you go through at work, in school,
raising your family, or keeping up with college friends or work
colleagues can be tougheven onerous sometimesbut they
can make you stronger. In another 10 years, if you want to look
back feeling satisfaction rather than regret, you have to put in
work and effort now. Sometimes things will not work out the way
you want, but as long as you do your best and have the fortitude
to pick yourself up and keep moving forward, you will come out
a changed person, for the better.
The path The Way Ahead has traveled over the last 10 years
reflects this as well. In 2004, TWA was just an idea in the minds

of several young SPE professionals and Giovanni Paccaloni,

who served as 2005 SPE President. Since 2005, when the first
issue was printed, more than 110 young SPE professionals have
served on the TWA Editorial Committee. Three issues per
year from 2005 to 2014 have been written, edited, printed, and
mailed. This is our 30th issueVolume 10, Number 3mailed
to around 26,000 young SPE professionals.
Check out TWAs 10-year archive at [Link]
print/archives/[Link]. Over the years, TWAs look and feel
has changed dramatically. In recent years, weve ever-moreintently focused each issues content around a central theme.
And the covers have evolved from somewhat stock industry
images to beautiful, full-cover pieces of art. In fact, one of my
favorite parts of each issues cycle is seeing the cover emerge
from an idea to its final form.
Sustaining and evolving excellent content and beautiful
covers three issues per year over 10 years has prompted a
growing appreciation for TWA. The TWA brand is now so strong
that for many in the industry The Way Ahead not only represents
the magazine but also the entire population of SPE young
professional members.
This very special 10th anniversary issue continuesthis trend
of quality and insight as some of the oil and gas industrys most
accomplished professionals share not only their thoughts about
what has transpired in this industry over the last decade but also
what they hope to see happen in the next.
I am happy to end my time leading TWA by handing over the
reins to TWAs next Editor-in-Chief, Tony Fernandez. Ten years
ago, Tony and I werent even aware of each others existence. Now,
through TWA and SPE, we have gone from being acquaintances to
colleagues to friends. I cant think of anyone better to chart TWAs
course through the first year of its second decade.
Thank you to all those serving on the TWA Editorial
Committee this year. The magazine would cease to exist without
your hard work and contributions, which you manage to fit into
your very busy work schedules. If you are representative of the oil
and gas industrys future leaders, this business is in good hands.
I also want to thank the SPE staff for all their hard work in
putting each issue together, as well as Todd Willis, last years
Editor-in-Chief and now outgoing TWA Advisor. I learned a lot
while serving as Todds deputy. And during my tenure leading
this publication, I could always count on him for clear, thoughtful
guidance. Like Tony, he has become my good friend.
So what happens next? No clueand thats the fun part!
Bring on the next decade. TWA

Vol. 10 // No. 3 // 2014

TWA InterAct

Social Media and TWA

This issue officially marks the 10th anniversary of The Way
AheadVolume 10, Number 3TWAs 30th issue! A lot
has changed during the last 10 yearsespecially in social
media. Social media is now part of most large corporations
communication strategy and has helped fuel conversation
worldwide among TWA followers. Check SPE TWA social
media updates and share your thoughts:
Facebook: The Way Ahead
Twitter: @SPETheWayAhead
LinkedIn: SPE The Way Ahead

Tweets From
TWAs Twitter Page
@SPETheWayAhead25 March 2014
In #kualalumpur for #OTCAsia and to host the 1st @PetroBowl
Regional Qualifier! Great view from the hotelroom!
@SPETheWayAhead20 May 2014
In the #oilandgas industry, there should be no such thing as
an accident: [Link]/blog/2014/05/20/in-the-oil-gasindustry-there-should-be-no-such-thing-as-an-accident
@SPETheWayAhead27 May 2014
Is College Worth It? Clearly, New Data Say [Link]/1hsyj9r
@SPETheWayAhead30 May 2014
Interesting read on how millennials could upend Wall St,
Corporate America. What do you think? Send us your
comments! [Link]
posts/2014/05/28-winograd-hais-millennials-wall-streetkamarck
@SPETheWayAhead13 June 2014
Congrats to all the @PetroBowl qualifiers! Good luck!
The Official 2014 PetroBowl Championship Bracket
[Link]/2OzHkqz9O

CALL FOR EDITORS!

You could be on the TWA editorial team.
Turn to page 36 now to find out how to
apply and why it pays huge career and
personal dividends to help keep TWAs
creative juices flowing in its next decade.
@SPETheWayAhead17 June 2014
The oil & gas industry has a culture of safety, what about a
culture of health?: [Link]/blog/2014/06/17/the-oil-gasindustry-has-a-culture-of-safety-what-about-a-culture-ofhealth

You Are the Energy Sector: How Do

You Explain Energy to Others?
Ways that clearly, accurately, and fairly explain what we
do and how we do it to those outside our industrytheyre
pretty rare. As a goodwill ambassador for the industry
to family, friends, and even strangers, you have a great
opportunity to share those rare and trusted sources who
write without downplay or exaggeration about oil and gas
industry realities.
It would be great if everyone understood more about
what energy actually is and joined the discussion. For those
who are in the energy sector (likely most of you), this is our
livelihood! Weve listed a few sources here that we trust.
Share your trusted sources with us via TWAs social
media: Facebook, Twitter, or LinkedIn.
Fracturing, Shale Energy, and Oil Sands
Shale Energy: 10 Points Everyone Should Know,
released by the American Petroleum Institute, October 2013.
Available as apdf.
The Real Facts About Fracture Stimulation: The
Technology Behind Americas New Natural Gas Supplies,
released by the American Exploration and Production
Council, February 2010. Available as a pdf.
The US Geological Surveys frequently asked questions
about hydraulic fracturing: [Link]/faq/?q=taxonomy/
term/10132.
Oil Sands Today: Everything you need to know about
oil sands, brought to you by Canadas Oil Sands Producers:
[Link].
Stay tuned for moreand send us a note anytime. Got
more great, reliable sources? What are your thoughts about
the sites listed hereor any others youve found? Wed love
to hear your review of any of these sites, or others you might
come across.

TWA Interview

Bob Dudley
Chief Executive of BP
Bob Dudley,
became group
chief executive of
BP on 1 October
2010. He joined
Amoco in 1979
and worked
in a variety of engineering and
commercial posts in the US and
UK. Between 1994 and 1997,
Dudley worked on corporate
development in Russia, then joined
BP in London in 1999 following the
merger of BP and Amoco. From
2003 to 2008, he was president
and chief executive officer of TNKBP. On his return to BP in 2009,
Dudley was appointed to the BP
board as a managing director of
the BP Group with broad oversight
of the companys activities in the
Americas and Asia. On 23 June
2010, he was appointed president
and chief executive officer of
BPs Gulf Coast Restoration
Organization in the US. His broad
range of roles with Amoco and
BP has given him substantial
global experience. Dudley
earned a BS degree in chemical
engineering at the University of
Illinois, a master of international
management degree from the
Thunderbird School of Global
Management, and an MBA from
Southern Methodist University.

How did you get started in the

industry?
I have worked in the industry my entire
career. I went to the University of Illinois,
studied chemical engineering, and
realized not only did I like engineering,
but I also wanted to see the world. So
I studied for a masters of international
management and combined that with an
MBA program in Dallas, Texas, focused
on energy. I started with Amoco, one
of the predecessor companies of BP. It
was 1979, the price of oil was shooting
up, and I was not working on the
engineering side at the time, but rather
with an economic evaluations group
working on new international ventures.
So I did get to travel, and I loved the job.

Can you think of specific decisions

or relationships that had a lasting
impact in your career?
I realized that I wasnt using my
engineering background and I wanted
to know a lot more about the business.
So I asked the company if I could go
back and be an engineer. That was
a big break. I went from Chicago,
Illinois, to Hastings, Texas, worked as a
production/petroleum engineer in the
field there and then moved up to Houston
as a reservoir engineer for west Texas.
The second big choice in my career
was to move to Aberdeen, Scotland,
and work as an engineer on artificial
lift. Working in the North Sea was one
of the most exciting things an engineer
could do in the 1980s because that was
where all the giant offshore technology
was being developed. It was fantastic!
That had me hooked on the oil and gas
industry, the offshore industry, and
moving around.

What are some characteristics

one needs to make it to the senior
executive level?
I know many excellent executives in
our industry, and theyre all different.
Some are quiet, some are thoughtful,
and some are more spontaneous, but
they all ask questions. They learn and
are very curious people. Theyre all
incredibly enthusiastic about oil and
gas, they really know their industry
well, and they are passionate about
the people in the industry. You really
have to draw on other people to get
things accomplished. CEOs know that
everything is usually a lot more complex
than it looks, but, at the right point, you
do need to make decisions. You have to
realize the unintended consequences
and the interconnectedness of things in
our business. There has to be a sense of
stewardshipfor shareholders, for their
money; and in the case of national oil
companies, for their governments. You
have to stay connected to the industry,
the technology, and the new things that
are being developed. You cant get
too far away from that in this industry.
You also, I think, need to have a very
supportive family who makes many
trade-offs along the way.

What is your leadership style?

Being a leader was not really just a goal
for me, as much as getting things done
through people. I try not to micromanage
things, but I am a detail person. I could
not be a CEO and rise above all the
details. I have to stay connected to the
organization. And we do not live in a
command-and-control world today. I
try to act with respect, trying to always
put myself in the other persons shoes

Vol. 10 // No. 3 // 2014

TWA Interview
but still drive results and performance.
I like working with a team that sits
down, argues the pros and cons, and
openlydebates.

BP faced a major challenge in

2010 with the Deepwater Horizon
incident. How has this changed
theindustry?
If you look at the history in any
industryeverything from aviation to
manufacturingthere are points in time
where bad accidents have happened.
And always coming out of those are
changes that improve safety and
regulation going forwardthey make
everyone adjust. I think the Deepwater
Horizon accident has made the industry
further improve its standards universally
and rethink the relationship between
operators and contractors. And society
is working hard now to find the right
balance between regulation and the
ability to do things efficiently.

What has BP learned from the

incident and what has it done to get
back on track?
We have had a couple of big industrial
accidents that have shaken us. We
have been through a period in which
a company with great pride in its
accomplishments over a long history
lost some of that pride, but now I think
it is being restored. I think BP is a great
business. We want our people to have
the confidence to make decisions. But
the past decade has also made us rightly
question some things about ourselves.
I believe this is a healthy part of what
any company should do: look at its
strategy as well as how its organized
and what people, skills, behaviors, and
capabilities it values.
Weve found that we have made
ourselves overly complicated. Part of
that was well-intentioned: We built
structures and processes to make sure
that we could feel that we were always
double-checking and doing the right
thing. We of course still want always to

be safe, but we see now that there are

ways to simplify the organization while
still being true to that vision. Going
forward, I see us being more focuseda
business that doesnt do everything, but
focuses on what we do well.
For instance, we were a
decentralized organization around the
world. Its always easy to decentralize,
and there are advantages in a big
structure to create autonomous units and
say Go do things and be profitable.
But we now believe that a business of
our size, dealing with the kinds of risks
that we have, needs to be centralized.
We need to have standards that work all
around the world. There are many risks
that we have to deal with, with great
care, and great responsibility. Weve
now centralized project organizations
and the functional organizations, so you
can move the best people around and
devote time and energy on a problem
through a function.

What are the most pressing

challenges of our industry
today? Have they changed in the
lastdecade?
There are two kinds of challenges.
There are the above-ground ones, and
the below-ground ones. There are huge
challenges above the ground, which
can be political upheavals, regulatory
issues, legal frameworks, or taxation that
might not encourage development below
the ground, in the rocks. The world has
been through troubled times during my
35 years, and it continues to be troubled
today. There are simmering conflicts
around the world that are starting to
connect, so thats one of the challenges.
Weve also got the challenge of
societys negative view of the products
we make in the oil and gas industryits
not a popular industry with everyone.
Weve got parts of society that dont
encourage us to produce the energy
we need for growth and development.
And then theres the obvious concern
about climate change. Im optimistic
that humankind can solve this problem
because, if you go back in time, mankind

burned wood, went to coal over time,

then to oil, and now natural gas. Im
optimistic that mankind will solve this
problem through a long wavelength
transition to low-carbon energy, but
probably not as quickly as some
wouldlike.
Because energy has been an
industry with a boom-and-bust cycle
over the last 35 years or more, you have
had gaps where people didnt enter
into our business, particularly on the
engineering and geoscience side. A
great crew change is going to happen.
There were 10 or 15 years where
few went into the industry, so young
professionals are going to have great
opportunities that will come along fast
and accelerate as people suddenly start
moving out of the industry. But gaining
experience and getting people to soak
up as much as they canand getting an
older generation to pass on as much as
they canis a bigchallenge.
And below the ground also,
technically, high-temperature and highpressure technologies are going to be
part of our future challenges. The better
imaging of the subsurface is going to be
a really fun challenge for people. And
then keeping the oil and gas industry up
the technology curve of whats possible,
like constant metering and monitoring.
In an airplane almost everything is
monitored full time and in real time.
Theres so much potential in oil and gas
to do that with wells and fields, because
when you spend time with people in
some other high-tech manufacturing
industries, they say were way behind.

What are some key technology

challenges for the E&P industry?
Its going to be unique to different
geographies. The Houstons, Aberdeens,
Stavangersplaces like these will be
the centers of our remarkable ability
to work with seismic data, process
it, and make decisions faster. At all
production sites we should monitor
things much more in real time and
learn when problems are happening
much faster. One of the challenges is

to make sure that engineers working

with those systemsspend time in the
field, seeinghow it actually works and
gettingan intuitive feel. Theres the
science of itbut, like all professions, its
also an art.

BP published its Energy Outlook

2035 in January. How does BP view
the energy industrys future?
Today there are 7 billion people in the
world and therell be 9 billion people
in 2035. We believe that virtually
all forms of energy are going to be
needed. Hydrocarbons are not going
todisappear.
I like to call it the rule of 27s: From
our Energy Outlook, by 2035, 27% of the
energy will be provided by oil, 27% by
gas, and 27% by coal, almost equally.
Renewables will make up less than 10%.
We think that 90% of transport fuels will
remain oil-based in2035.
With virtually all the growth coming
from the non-OECD world, these
countries will have a natural desire for
prosperity. Gas is a little different than
oil. It appears to be more regional, even
though you can liquefy it and move it
around. Natural gas has created an
incredible boom in the US economy.
The oil increase in the US has offset the
outages in places like Libya and Sudan
in the last year. And if we hadnt had the
increase in oil production in the US to
fill this gap, I could see the price of oil
being USD 150 per barrel today. So if
you link that to people working in our
industry, theres a great future in oil and
gas with all kinds of opportunities. Its
not an industry thats going to sunset
anytime soon.

What advice would you offer young

professionals considering a career
in this industry?
You can build a very exciting career in
different parts of the world working with
different people, cultures, governments,
and enormous technical challenges.
When you come out of a university,

you are going to enter into an industry

with a clock-speed that is going to get
faster and faster and the technology
will continue to push at the frontiers of
science and engineering.
Excellence doesnt come overnight.
Always remember, it takes time to
become really good at what youre
doing. Get close to the technology,
see it in action out in the field. Its very
important, after a period of time, to either
love what youre doing or get out. Im
not sure I enjoyed my job immediately;
suddenly life is more structured and
you have to get up every morning and
go to work, but now I dont even look at
the clock. That first year of a career is
quite different: People dont give you
instructions and tell you exactly what to
do, so youre not sure youre making a
contributionit just comes quickly with
your own personalenthusiasm.

gasindustry. In many ways the

promiseof efficiencies didnt quite
happen. I find people at BP and
all theheritage companies to be
incrediblyloyal to the company. People
want to see it succeed. They have been
througha verydifficult4 years. The
people whoare working it really just
want to get the company back on its feet,
and do well, with no arrogance. Thats a
remarkable thing, and its hard to put a
value on that.
Weve crossed some of the emotional
bridges of selling various things that big
companiescan become very attachedto.
I think people realize we are a business,
so weve gotto perform in a certain way.
I think BP is well-positioned to do that.
Im optimisticabout BPs future, and I
couldnt be more impressedwiththe
dedication of everybody around
theworld.

How have you been involved in

SPE?How does your workforce
leverage company activities with
SPE expertise?

What would you mention to attract

students and young professionals to
join the oil and gas industry?

I joined SPE when I was working in the

field in Texas, and Ive been a member
for over 30 years. I found it a way to
network with more professionals. When
I was in Russia, we worked closely with
SPEs local chapter and utilized it to
develop local talent on a bigger scale
and connect people.
I chaired a large SPE conference
in Moscow and got other companies
and people involved, particularly from
around the world. Many BP locations do
that to develop a sense of connection
with the industryin Angola, Indonesia,
Azerbaijan. It creates a sense of
professional belonging around the world
that we take for granted when working
from one location.

How do you see company loyalty

within BP?
What BP and Amoco and Arco did
starting in 1998 kicked off a large
wave of consolidation of the oil and

We just have such an interesting story

to tell about what we doin terms ofthe
high-tech nature of it, the leading-edge
technology and engineering, the job
opportunities, the vital nature of energy
to drive prosperity, economic growth,
and provide heat, light, and power
for societymuch of which wetake
forgranted.
We can do a much better job as
an industry in telling our story
becauseits a very exciting industry
and we should get young people
to thinkabout the industry earlier,
so thatthese great careers are in
theirsights.
Every person whos a member
of SPE should try to tell that story
in highschools, colleges, and
communitiesso that more of us
can make this essentialcontribution
tosociety, providing critical
supplies of energytotheworld,
and at the same time enjoying
greatlyvaried,challenging, and
deeplyrewarding careers across
theworld. TWA

Vol. 10 // No. 3 // 2014

HR Discussion

Recruitment Trends and

TalentManagement10 Years:
APanoramic View
P.C. Bahuguna, University of Petroleum and Engineering Studies

With continuous development in energy

policies across many countries, the
great crew change, and increased
international oil and gas trade, the
hydrocarbon sector has reached a
crossroads. On the one hand, the
demand for oil and gas is constantly
increasing; on the other hand, issues
such as greenhouse gas emissions
and climate change, pricing, security
of supply, and constantly increasing
exploration and production budgets are
pressing the industry severely.
To meet continued increasing
demand and offset the challenges,
skilled human resources are key.
The challenge for companies is to
develop rigorous talent management
systems to help ensure availability of
the most-experienced, best-trained,
best-educated, most-flexible, and
most-adaptable people for the industry
and then find meaningful and creative
ways of retaining them while also using
them to truly enhance the companys
productivity and profitability.
In the last 10 years, the oil and gas
industry has seen major changes in
trading practices throughout the value
chain. Deregulation of petroleum
products in India led to increased

competition mainly in the downstream

sector. This, in turn, forced companies
to change hiring patterns to better
cope with the higher standards and
requirements that became prevalent
in the market. Retirement rates are still
increasing, giving rise to the industrys
current talent crunch.
In response, the industrys
recruitment focus has shifted toward
young professionals and graduates.
The upstream sector clearly requires
specialized technical expertisebut at
a very demanding levelto tackle major
technical challenges, such as figuring
out how to turn around reserves on the
verge of depletion. Thus, hiring is aimed
toward engineers and highly specialized
recruits who have the knowledge and
skill to create effective solutions.
The sector now demands such high
levels of investment, that companies
focus on hiring the best-of-the-best
talentwith experienced candidates
highly valuedso companies enjoy
immediate return oninvestment.
Companies are now building
detailed plans into their budget
processes to fortify their talent pools and
improve their capabilities. Specialist
skills are more valued today than at

P.C. Bahuguna teaches strategic human resource management, organizational

behavior, and economics at the College of Management and Economics Studies,
University of Petroleum and Energy Studies, India. He is an experienced trainer,
consultant, and administrator for companies in the consultancy services,
hospitality, and printing industries, among others. Bahugunas academic
papers have appeared in several international journals. Besides organizing
and conducting in-house training programs, he facilitates sessions on people
skills and performance management for organizations from different industries,
including the oil and gas and power sectors. He holds a bachelors degree
in science, an MA in economics, an MBA, and a PhD in management.

any other time in the past 2 decades.

Industry leaders have re-envisioned
their upstream operating models:
These models are technically thematic
organizations, with the focus on assetbased models in an attempt to get a
better handle on costs, identify specific
technical needs, and build effective
solutions. The purpose is to allow the
development of strong, differentiated
core capabilitiesan important
ingredient for sustainable growth.
These changes call for rigorous
and focused recruitment, training and
development, and retention programs.
The hiring pattern now is to seek out
fresh and talented recruits who can
learn and grow to fulfill the longer-term
need to sustain the industrylearning
the industrys old arts while bringing in
creative and innovative ideas.

Global Outlook
Energy, key to achieving high growth
rates in all sectors, is considered the
lifeline of any country. It has helped fuel
Indias growth since independence in
1947 and will remain the key driver of
economic growth in years to come.
The Indian oil and gas sector is likely
to require around 25,000 additional
professionalsalmost 50% more than
the sectors total employment nowin
the next 5 years due to business growth
and retirement or attrition in the sector.
In this part of the world, awareness
of the oil and gas industry is rising, with
more and more academic institutions
emerging that cater to the energy
sector. The focus here is definitely
on the extraction of hydrocarbons
and even more on the exploitation of
mature fieldsas we look to rise as an
economy,. Asian countries are looking

towards African and Middle Eastern

oil-rich areas to boost their production
capacity. China, in addition to India, is
acquiring stakes and blocks abroad
to add to their existing capacity. Even
Indian downstream companies have
started participating in acquiring
blocks abroad. This has given rise to
new projects and has generated new
jobopportunities.

Changing Approach Towards

Talent Management
Companies will have to deploy some
kind of rotational program that includes
international assignments to ensure
a constant and uninterrupted talent
pipeline for leadership roles. Besides the
focused and intense in-house training
system, companies will also have to look
for alliances to gain new capabilities
and access to resources. Partnerships
between companies with different
priorities and areas of expertise
areessential.
Today, firms need to have a
geocentric approach to hiring because
finding appropriate local talent in
some localities is almost impossible.
Previously, people received on-thejob skill training, and that worked out
to a great extent. Now however, with
advancements on the technological
front at their peak, the demand for
specialized talent is on the rise, which
in turn is reflected by several planned
specialized academic courses coming
up. Although it is always an option
to train new recruits, those already
with required skill sets could help the
employer eliminate the necessity of
elaborate training and can utilize the
talent from day one. In my opinion,
companies can eventually employ a fair
mix of both general management skills
and specialized skills instead of focusing
on just one stratum.

to take into account the need for strategy

building, brand enhancement, value
generation to cope with the competition
along with the technical challenges and
advancement to beundertaken.
Earlier, the trend was to hire
from domain-specific universities
in the energy sector. But increasing
competition led to focusing on the
premier institutes to get the best
workforce. There should exist a
balancebetween the two to best adapt
to the existing challenges. The pattern of
recruiting in the coming years will be to
increase hiring so as to bridge the gap
of the crew change. With more potential
employees to choose from, the hiring
will definitely be more competitive.
With innovative, creative and fresh
talent on the rise due to the increased
awareness about the energy sector, the
dearthoftalent is definitely coming to
an end.

and more experience, those wanting to

be recruited will now also need to gain
prior experience.
More emphasis is placed on
the midstream and downstream
in this part of the world because
underexploited reservoirs are maturing
yet still holdrespectable quantities
of unrecovered oil. That said, some
companies also engage in vigorous
exploration campaigns. Currently,
manyjobs havebeen created that
concentrate on an individuals technical
capabilities. In India, a majority of the
upstream sector consists of private
players, whereas downstream is
dominated by government-owned
public-sector undertakings (PSUs).
Upstream players hire based on
technical expertise and experience
profiles. PSUs recruit employees both
through the nationallevel exam process
and campusvisits.

Shale Gas Discoveries and

Increasing Production Worldwide

Joining the Oil and Gas Industry

With the shale boom, those specializing

in unconventional resource exploration
and production have an edge over
others. Today, many upstream players
in India are keen on recruiting
individuals with specialized knowledge
andtraining.
With shale gas discoveries and
production worldwide, particularly
in the US, Canada, Australia, Finland,
and China, there is a real incentive to
acquire new skill sets. This is possible
only through exchange programs and
tie-ins with the corporate sector. For
example, oil and gas companies in India
such as Reliance Industries and Gas
Authority of India have already acquired
shale gas assets in North America and
deputed its petroleum engineers for onthe-job training.

Future Recruitment Trends

Graduates with Specialized Oil

and Gas Education/Training

Since the advent of fierce competition,

share cannibalization along with the
talent crunch scenario, employers are
having to figure out the right mix of
general and specialized skill sets. The
scenario would require hiring patterns

Until now, having previous industry

work experience was valued more than
having fresh talent unsullied by the real
world. But as the older crew moves
into retirement and the younger crew
joins the industry and matures with more

All who want to be part of the

energy sector must first focus
on building theirbasic skill set,
because this industry requires
solid understandingacross
several disciplinesdue the
interdisciplinary,team-based
nature of the work. After honing
their technical acumen via the most
suitableuniversitycourses, programs,
and degree curricula, they can then
specialize inspecific subdomains
of interest, as specializationis also
required in thisswiftly progressing,
technologicallysavvy sector.
Institutes with degree programs
that concentratemainly on the
energysectorshould also include
managerial-skill development and
broad general-industry topics in
thecurriculum.
In a sector so different from other
sectors in each and every way, a
strong basic skill set across many
disciplines, an intense focus on one
or two specialized subjects, a welldeveloped managerial skill set, and
an understanding of broad industry
topicsall are needed to excel in the
energy sector. TWA

Vol. 10 // No. 3 // 2014

Forum

Excelling in Your First 10 Years:

Ten Life Lessons
Jakob Roth, Schlumberger and Islin Munisteri, BP

Between training programs and moving

to new locations, a lot can happen in the
first 10 years of your career. The TWA
Forum team informally talked with our
colleagues and found that people whose
backgrounds appeared disparate often
voiced similar themes regarding what
they learned in their first 10 years in the
real world of the workplace. Below are
the nine life lessons that emerged from
these discussionsplus one for you
towrite.
1. What you do, or dont do,
createsthe reputation you have
amongst your peers. Be responsible
for yourselfyour conduct, your actions,
and your behavior.
Your reputation in the oil and
gas industry has been building
since the day you entered the game
and is being continually developed
daily amongst your peers, coworkers, and other professionals.
How you interact and deal with your
coworkers,management,clients,
suppliers, and contractors all play
a direct role in developing and
maintaining your reputation in
theindustry.
Your reputation is related to the
value you bring to your company. And
remember, first impressions definitely
count, so always give a respectable
handshake and smile. Timothy Price,
president at Heath Energy Products
Corp., says, This is an industry where
you will cross paths with thousands
of people who all cross paths with
each other. Therefore, nothing is more
important than your reputation.
When transitioning to a new role,
realize that you should always uphold
your reputation, it will precede you and

10

hold you accountable, says Darren

Vaught, special projects manager
atHydessco.
What underpins reputation is
integrity. Larry Bartram, region account
manager at Halliburtons Multi-Chem,
notes, In any industry, honesty and
integrity are first and foremost. Your
reputation is of paramount importance to
your success.
2. Hold true to your integrity so that
you can produce sound engineering
work that aligns with your values. At
its core, integrity means alignment
between what you do and who you are.
Being who you are can be defined by
your personalvalues.
Professor Steve Begg, head of
the Petroleum Engineering School,
University of Adelaide, Australia, says
to never lose your integrity. The
big wrongs are obvious, though not
necessarily easy to deal with. Its the
small things that can gradually lead you
astrayno one instance itself seems
thatbad.
Know that your decisions are
impactful, and the results have some
probability of spreading publicly
across a wide swath of people. Chris
Buckingham, program director at
the Fluid Dynamics and Multiphase
Flow Program at Southwest Research
Institute, notes that In all that you do,
everywherenot just at workseek
to have a reputation for impeccable
integrity, only making decisions you
wouldnt mind being posted on a
billboard at the side of the highway.
3. Dont let problems fester.
Approach issues immediately, and talk
with people to get your concerns voiced

early on so that action can be taken. If

necessary, changes can occur and if
not, you can work on understanding the
reasons why. Being able to go to sleep at
night without worrying is a key indicator
of how people deal with their problems.
Being able toand actually
speaking up is critical to success,
particularly in the context of safety. The
oil field is one of the most dangerous
places in which to work, but with the
correct mindset and proper measures
in place we can prevent accidents
from occurring. Maintaining safety as
an integral value will go a long way to
having a long and successful career in
the industry.
Imran Qaiser, directional driller
and field engineer at Schlumberger,
notes to always take 5 minutes to
analyze any task before proceeding.
Communications is key. You have the
authority to stop any job if you feel it [is]
not safe.
4. Know and plan to your rhythms
to develop a sustainable routine.
Plan accordingly, especially if you have
weeklong training, vacation, or other
events throughout the year. If you have
the ability to control your schedule, try
not to have a big meeting the day after
a lengthy vacation. Try to arrange your
vacation to occur after a major business
planning cycle.
Though some schedules are
unpredictable, elements of anticipation
can still be engineered throughout the
day. Even making small tweaks in when
you perform detailed technical work and
make decisions can have large gains in
productivity. David Rock, director of the
NeuroLeadership Institute, writes that
your ability to make great decisions

is a limited resourcethis means

not thinking when you dont have to,
becoming disciplined about not paying
to attention to nonurgent tasks unless, or
until, its truly essential that you do.
The cadence of the day can be
arranged accordingly by focusing on
the most important task each day. For
nearly a decade now, Ive begun my
workdays by focusing for 90 minutes,
uninterrupted, on the task I decide the
night before is the important one Ill face
the following day. After 90 minutes, I
take a break, says Tony Schwartz, chief
executive officer of the Energy Project
and author of Be Excellent at Anything.
5. Create a boundary between
work and other facets of life to stay
focused. Expect burnout if you cannot
hold to these boundaries. It means not
checking email when spending time
with friends at a restaurant. It means
not looking at Facebook while trying to
read a technical paper. Freedom can be
found in boundaries.
Human beings are not designed to
do activities simultaneously, but rather
successively. In a world of relentless
demands, it is only possible to main
a high level of intensity if you create
boundaries, says Schwartz.
The key to creating the boundary
is in understanding your own and your
managers expectations, and ensuring
that there is alignment between the two.
According to an article in Fast Company,
Ken and Scott Blanchard recommend
that you and your manager each create
separate lists of things you are held
accountable for in your role. Afterwards,
prioritize the list and ensure that you
and your manager agree on the most
important tasks. Having regular checkins ensures that you and your manager
stay aligned throughout the year.
Know that there will be times when
work is a 24-hour-a-day marathon,
such as during operations when your
well is being drilled. However, there
will also be times the focus will be
planning the well or defining drilling
rig specifications. Understanding the
difference in response time between
the twooperations and planning

is important in determining where

boundaries can be defined.
6. Create and maintain your
community. It is 2 a.m. A major
problem is happening. You take the
call and give a quick answer, but there
are more engineering details involved.
Know who you can turn to when you
need help. Other people have faced
many problems and have a lot of
experience you can draw upon. You
can find a solution simply by asking and
listening to people in your network. Take
notes when talking to these mentors
not just technical details, but also their
personal lives so you can reconnect the
relationship at a moments noticeeven
if you generally stay in touch in the
firstplace.
In a Harvard Business Review article
by Priscilla Claman, she recommends
setting up a personal career board of
directors you can consult and receive
feedback from so you can grow. The
people on your board of directors should
know more than you about something,
be better than you at something, or
be capable of offering different points
of view, writes Claman, president of
Career Strategies Inc.
Often, one person alone cannot
advise on both reservoir modeling
and emulsion properties. Look inside
and outside your company to develop
those relationshipsso that when you
need it most, the experts are there for
you. Often, these folks are found in
previous roles, college, and online
on SPE Connect, LinkedIn, and other
forums. The occasional email sent to the
professors who helped you graduate
goes a long way in maintaining those
relationships. After moving on from
one role to another, dont neglect the
previous relationships you made.
7. Never stop learning, and mature
from your mistakes. There exists
of a plethora of resources that can be
very beneficial both technically and
professionally in your career. Learning
occurs in formal settings, such as
training and in college, as well as on the
job through executing yourprojects.

Regardless of the ways

youve devised for retaining new
knowledge,keep on learning
somethingnew, even from colleagues
who sit next door. Thalbert Thal
McGinness, a consulting petrophysicist,
notes that you should always be willing
to listen first and learn something
everyday.
Failure, though at times
embarrassing and painful, is often
where the best learning occurs. Always
remember, learning is a never-ending
process. Listen to everyone, but apply
your own mind. Take responsibility for
your failures and more importantly
learn from failures. It is the failure which
is our real teacher, says Dr. Milap
Goud, technical managerAsia Pacific at
Q-Max Solutions Inc.
The approach to learning is just as
important as what is being committed
to memory. Having an open mind
enables the lesson to be learnt well
the first time. Always be anxious to
learn because everyone around you
knows more aboutsomething than
you do, saysHeath Energy Products
TimothyPrice.
8. Field experience is critical. In
the multidisciplinary oil field, gaining
even a general understanding of
field operations can save you and
your company time and money. The
knowledge gained by going to observe
operationsor better yet, performing
those operationswill help in asking the
right questions aboutwhycost and time
were under-or over-projected.
According to David Dixon, a
graduate production technologist
(production engineer) at Shell, [There
is] no substitute for field experience.
Theoretical understanding is great but
you need to see it happen to understand
the risks involved in any operation.
Glenn Vawter, executive director
at National Oil Shale Association and
president of ATP Services, cuts to the
core regarding the value gained from
firsthand field experience: If you dont
know what it takes to get it done in the
field, you cannot design programs that
can be carried out by those talented

Vol. 10 // No. 3 // 2014

11

Forum

SPE Bookstore

U.S. Crude Oil Production

versus Hubbert Curve

11
10

L
IT

EW

Millions of barrels per day

9
8
7
6
5
4
3
2
1
0
1900 1910 1920 1930 1940

Print and Digital Versions Available

1950 1960 1970 1980 1990 2000

US Production

2010

Hubbert Curve

Chemistry for Enhancing the

Production of Oil and Gas

Fig. 1US crude oil production versus Hubbert Curve. Data Source: United States
Energy Information Administration.

Chemistry for Enhancing the Production of Oil

and Gas provides an overview of the science
and technology of the use of production
chemicals to enhance and maintain oil and
gas production. Geared towards a technically
trained audience, this new book emphasizes the
technical aspects of production management
from the perspective of the upstream oil and
gas industry.

people who really get the work done,

and done right, and done professionally.

Wayne Frenier & Murtaza Ziauddin

Contents
Introduction
Chemistry of Production Impairment
Formation Stimulation With Reactive
Chemicals
Propped Fracturing Chemistry and
Applications
Improved Oil Recovery Chemical Applications
Health, Ecology, and Safe Handling of Treating
Chemicals and Produced Fluids

9. Be open to and accept change.

In a publication titled Nuclear Energy
and the Fossil Fuels, M. King Hubbert
predicted in 1956 that peak oil in the
United States would occur between 1965
and 1971, However, he did not predict
the rise in oil production from tight
oil. Using a combination of hydraulic
fracturing and horizontal drilling, the
ability to produce from low-permeability
source rock would not become
economic until more than 40 years
later. However, now those technologies
have unlocked tight source rock and

Preview sample pages from this new

book and order your own copy by
visiting our online bookstore at
[Link]/go/books.

are driving current US oil and gas

production. Dixon notes, Always expect
the unexpected. The oil and gas industry
is terrible at predicting anything. Always
have a back-up plan.
10. Write your own life lesson
learned in the oil field. Think about
and reflect on the critical lessons you
have learned. Pick the most important
lesson, and write it down. Discuss this
topic with your colleagues and personal
board of directors.
This is not a hard-and-fast list
remember you will keep learningso
keep adding life lessons with each
valuable insight you gain. TWA

Celebrating 10 Years
of Fresh Energy &
Creative Ideas!
TENTH ANNIVERSARY ISSUE

Economists Corner

Reflections: The Last Decade and

the Next Decade
For the oil and gas industry, the last
decade (2003 to 2013) has been one of
resilience, extraordinary innovation,
and, despite setbacks, significant
gains in safety and environmental
conformance, according to Paal
Kibsbaard, chief executive officer of
Schlumberger, in his report A Decade
of Upstream Technology Innovation
included in the World Petroleum
Councils 80th Anniversary Edition
report (2013). The industry remains
strong, after sustaining humanitys
supply of oil and gas and thereby
meeting more than half the global
energy needs throughout the decade.
In the June 2010 issue of the Journal of
Petroleum Technology, Behrooz Fattahi,
2010 SPE president, said the industry
has been focusing on the concept of
sustainability or its components for a
long time, but under different descriptive
termsoptimizing production,
maximizing reserves, reducing cost,
cutting waste, increasing efficiency,
optimizing processes, minimizing
footprint, maximizing safety, reducing
environmental impact, and increasing
corporate social responsibility.
Sensitivity to all these factors is
required when looking back on the
industrys last 10 years and looking
ahead to the next 10 years. The oil and
gas industry has always been a risky

$/barrel

Pradeep B. Jadhav and Lalitkumar K. Kshirsagar, Maharashtra Institute of Technology

120.00
110.00
100.00
90.00
80.00
70.00
60.00
50.00
40.00
30.00
20.00
10.00
1995

Oil Price

1997

1999

2001

2003

Dubai

2005

2007

Brent

2009

2011

WTA

2013

Year

Fig. 1Oil prices since 1995, comparing trends for different brands (or grades)
ofcrude oil.
business for many reasonsfrom
geophysics to geopolitics.

Technology-Driven Decade
The oil and gas industry has been
technology-driven since Colonel Edwin
Drake developed a method for producing
large quantities of oil in 1859. And while
the last decade has shown no giant
discoveries like those made in the 1950s,
technology developed during this time
has helped the industry in many ways.
Engineers now understand
complicated reservoirs much better
through ever-more-sophisticated 3D
modeling. The industry can drill in
increasingly hostile environments
including ultradeep water. Natural

Lalitkumar K. Kshirsagar is holder of the ONGC Chair

and principal of the Maharashtra Institute of Technology,
University of Pune, India. Objectives of the chair are to
promote knowledge and excellence in the area of petroleum
engineering through research, training, workshops, and
work associations. He has more than 25 years experience in
the oil and gas industry as a professor, leader, subject-matter
expert, and industry advisor to both profit and nonprofit
organizations. Kshirsagar received the SPE Regional Outstanding Service Award for
Middle East, Africa, and India in 2006.

gas, including unconventional gas,

has emerged as a strong player in the
international market. Horizontal wells
with several kilometers of reservoir
contact have become a reality. Real-time
drilling data is ever more precise and
abundant. Rock physics and reservoir
simulation have evolved significantly.
Many enhancements in production
technology have been developed.
Subsea engineering has advanced at
arapid pace.
Until the latter part of the decade,
much of the industry thought the
moment of peak oil was just about
to arrive. But with the emergence of
nonconventional thinking, particularly
related to technology, further oil and
gas development has not only delayed
peak oil but has provided extremely
good challenges for the industry in
tackling how to convert unconventional
resources into reserves. This has
become possible due to a sustained
highpriceenvironment.

Oil Price Elasticity in

the Last Decade
As illustrated in Fig. 1, oil prices were
extremely low in 1998. Crude oil prices
steadily rose between 1998 and 2008
Vol. 10 // No. 3 // 2014

13

Economists Corner

Oil Production
90,000
80,000
X 1000 BOPD

70,000
60,000
50,000
40,000
30,000
20,000
10,000
0

World
(A)

Ultra
Light

Light & Light & Light & Medium Medium Medium Heavy Heavy Heavy
Sweet Medium Sour & Sour
&
& Sour
&
&
&
Sour
Medium
Sweet Medium Sour
Sour
Sour

Access to Reserves

Oil Quality

1995

2000

2005

2008

2009

2010

2011

2012

Fig. 2Quality of crude oil produced between 1995 and 2012. Data source: Eni.

Disruptions and Long-Term Productive Capacity

change in crude oil production from pre-disruption level

million barrels per day (MMbbl/d)

1
Kuwait
0
1

Venezuela

2
Iraq
3
4

Iran

5
6
Month 1* Year 2 Year 4 Year 6 Year 8 Year 10 Year 12 Year 14 Year 16 Year 18 Year 20

Fig. 3Examples of disruptions in oil production and long-term

productivecapacity.

and then took a steep tumble during

2009. In the following years, crude oil
prices survived the 2009 drop to 2006
prices, and climbed back to or above
2008 levels by the end of 2013.
A higher crude oil price allows
companies to drive higher investment
in extraction techniques, and market
forces drive green innovation at every
level. However, just to keep production
at todays levels, more than half of the
energy-supply investment is needed.

14

of light and sweet oil, it still contributed

an average of around 15% to total world
production during the last 10 years.
The presence of a high-oil-price
environment in the international market
shows a corresponding impact on the
economies of oil-importing countries,
enrolment of petroleum engineering
students, market opportunities for new
entrants to the industry, mobility of young
professionals, research funding, and
also on projects related to emerging and
peripheral technologies.

The price differential in brand oil has

slowly become more marked since 2003.
In the last 2 years, the price differential
between WTI and Brent has been more
than USD 15/bbl.
A cursory look at the quality of oil
produced between 1995 and 2012 all over
the Earth (Fig. 2) shows an almost 30%
production increase in medium and sour
oil, and a production decrease in light
and sweet oil that showed an upswing in
2012. Despite the decrease in production

According to John Mitchell et al. in

their 2012 Chatham House report,
What Next for the Oil and Gas Industry?,
The top 50 companies controlled
94% of world oil reserves in 2010, up
from 86% in 2000; of the worlds oil
reserves 86% are state-owned, while
the proportion under private ownership
in the top 50companies is roughly 8%:
If all smaller companies are included,
private-sector ownership would be
about 14%.
However, Mitchell et al. point out that
national oil companies (NOCs) share
of oil production is only 55% because
of their more conservative depletion
policies and lack of investment, as well
as obstacles to private-sector investment
by foreign companies. A few NOCs
have become more aggressive due
to higher consumption and limited
resources in their region and have
formed consortiums with international
oil companies (IOCs) in developing
areas such as Angola and Nigeria.
In addition, during the last decade
international service companies have
merged with or acquired a significant
number of independent companies
with specialized technology, which has
provided the large service companies
with greaterdiversification.
When NOCs acquire frontier
basins, they often lack the experience
or technology to adequately tackle
the challenge and manage the risk.
Therefore, it is advantageous for NOCs
to accept partnerships with IOCs and
service companies that have the needed
technology and experience.

Geopolitical factors can easily

disrupt crude oil supply, which plays a
major role in the economic growth of
many countries. Disruptions during the
last 15 years effectively reduced crude
oil production in certain geographic
regions, such as those illustrated in
Fig. 3, resulting in significantly lower
production than capacity, which affects
project profitability.
When oil prices and gross domestic
product (GDP) growth rates are tracked
on a global scale, there is an interesting
interplay between their trends. Between
2008 and 2009 oil prices sustained big
impacts; large drops in GDP growth
rate came significantly after the oil price
shock. The GDP growth rate was very
low in 1998 and very high in 2008. The
volatile environments in Iraq, Egypt, and
Iran continue to have a significant impact
on the price of oil.

Technology Growth:
Past and Future
The rise in challenging oil and
gas resource targets, as illustrated
in Fig.4, clearly demands an
accompanying growth in geophysical
understanding and also increasing
expenditure for equipment, vessels,
techniques, and technologyand their
development. Because drilling occurs
in ever-more-challenging and hostile
environments, global E&P spending is
poised to reach a new record in 2014,
estimated at USD 723 billion, up 6.1%
from USD 682 billion in 2013.
According to Douglas-Westwoods
20142018 market forecast, global
subsea hardware capital expenditure
could total USD 117 billion during the
forecast period. The energy research
group expects subsea hardware
spend will be highest in Africa, Latin
America, and North America, with these
regions providing almost half the total
expenditure. The rising expenditure
will essentially be due to work in
extreme environments; short supply
of rigs, ships, and people; production
in environmentally high-risk areas
(climatic uncertainty); operation in
politically high-risk areas; and giant
declining mature fields. However,

20 Years Before

Ten Years Before

Conventional
Onshore
Unconventional

Present and Future

Heavy Oil
Arctic
EOR
HPHT
Contaminated Gas
Tight Oil/Gas

Shallow Water

Offshore

Deepwater

Shale Oil/Gas
CBM
Ultra Deepwater
Pre Salt 1

Modified after Intelligent North Sea Market Review 2012

Fig. 4Oil and gas resource targets accompany technology challenges.

70
60
50
40
30
20
10
0
10
20
30
40
2007

support
extraction

oil and
natural gas
industry

drilling
all private sector
employment

2008

2009

2010

2011

2012

Fig. 5Growth in petroleum industry employment versus all private sector

employment. Source: US Bureau of Labor Statistics.

key technology challenges will be in

reducing environmental footprint during
drillingand completion and aiming
forzero-emission well tests.
According to Bob Dudley, BP chief
executive officer, in the 2013 Fuellers
Annual Energy Lecture he gave,
titled Certainties and Surprises: The
Unfolding21st Century Energy Story,
while smart technology matters, smart
people matter more. One absolute
certainty is that the baby-boomer
generation is now retiring and the
growing industry will face a shortage of
highly skilled engineers, technologists,
geologists, and other professionals.
So we urgently need to show young
peoplearound the worldthat this is

an industry with a great future as well as

a great past.

New Entrants and Young

Professionals
A clear relation between oil prices
(Fig. 1), GDP growth, and placement
in the petroleum industry (Fig. 5) can
beseen.
According to the Schlumberger
Business Consulting 2012 Oil and Gas
HR Benchmark, by 2016 the shortage of
experienced petrotechnical professionals
(PTPs older than 35) is projected to
reach 20% of the talent poolequivalent
to lacking 15,300 experienced PTPs
who would be needed to shore up
the projected existing total pool of
Vol. 10 // No. 3 // 2014

15

Economists Corner

experienced 74,300 PTPs. However, in

most petroleum-related disciplines, the
supply of new graduates is expected to
be almost 40% more than demand
5 years from 2014.
The petroleum industry demands
from our future leaders and managers a
basic understanding of the oil business
and the global markettrends, risks,
and economic implications. Knowledge
about major oil and service companies
and their markets and geographic
areas of operation is also necessary
since professional development and
promotions often come with reallocation
to a different region or country.
Attitude towards work, general
working skills like protocol following,
thinking out of the box, adaptive nature,
ability to think of alternative solutions
and providing them quickly, and a basic
knowledge of disciplines will be required
because automation will take over
routinework.

Challenges for Universities

The petroleum industry has a reputation
for offering global opportunities and
high salaries to competent engineers.
This has played a role in the significant
rise in student enrolment in university
petroleum engineering programs all
over the globe.
Recognizing that high expectations
might cloud students judgment about
their petroleum industry career
prospects, Texas A&M University
recently sent a letter to their incoming
students advising them to be realistic
about future job growth.
Are we producing surplus engineers?
If so, salaries and opportunities could fall
as competition for positions rises. Future
hiring may increasingly be based on
significant differences in talent among
large numbers of graduates rather than
on companies vying among each other
to entice a few among a small number
ofgraduates.
In August 2013, SPE sponsored a
week-long Forum, the results of which
were published in a white paper titled
2020 Foresight: Ensuring Educational
Excellence for Upstream Engineering

16

Resources. The following are two key

issues the 47 participants identified:
Nearly two-thirds of the US faculty
will qualify for retirement in the next
10 years.
Many new petroleum engineering
PhD graduates lack industry
experience. Those recruited
into faculty positions from other
disciplines also typically lack
practical industry experience.
In their 2005 Oil and Gas Business
online journal article, titled Looking
Ahead: Challenges for Petroleum
Engineering Education, University of
Alberta authors J.C. and L.B. Cunha
state, The evolution of technology
as well as the increasing presence of
computerized tools in nearly all stages of
the exploration-production process has
generated new needs in the educational
system. One frequent comment is that
academia not always has evolved fast
enough in order to meet those needs.
As exploration and production shift
to ever-more-difficult and challenging

areas, petroleum engineering curricula

need to add focuses on environmental
and climatic issues, sustainability, and
thechanging energy mix. The SPE
Forum emphasized the need within
petroleum engineering programs
for industry-driven, interdisciplinary
project coursesthat are generally
difficult to develop and conduct without
the requisite work experience or
understanding of the industry. Academia
also needs to identify and/or develop
competent teaching professors to
avoid possible gaps in training and
education that futureengineers will
increasingly requirein dealing with
the demandsofalifelong career in the
energy industry.
Industry initiation and
collaborationwith academic institutes
regarding accreditation and an SPE
graduating matrix need acceleration
to produce employable engineers.
SPE has already taken significant steps
toencourage students and faculty
members by way of organizing valueadded events. TWA

Pradeep B. Jadhav is a professor and subject-matter expert

in petroleum engineering, as well as head of the Petroleum
Engineering Department at Maharashtra Institute of
Technology, University of Pune, India. He has more than 20
years industry experience. Jadhav works as an advisor,
speaker, and member of oil and gas organizations,
associations, and committees. His recognized professional
expertise is in petroleum geology, integrated reservoir
studies, petroleum economics, and international oil and gas business strategy.

Pillars of the Industry

A Decade of Career Choices and

Defining Moments
Vivek Sharma, Halliburton Consulting

In 2000, information technology

employers were the companies with the
most prominent campus recruitment
efforts, but I wanted to enter the energy
domain. At the time, options were limited
and wireline logging and perforating
engineering were among the only
domains to enter.
Looking back, it was the best thing
to have happened. Oil was trading
at about USD 30/bbl with energy
needs continuing to grow in emerging
economies such as China and India.
The ongoing need for oil would keep
demand high for oilfield workersan
observation I made earlyon.

Multiple Oilfield Services

Career Options
Most new graduates begin their careers
as trainees in the field. For many, after
only a few years of working in the field,
the question becomes when and how to
pursue alternative opportunities. There
is no easy answer.
The last 10 years have provided
a variety of options. Today, the
industry needs people with deep
knowledgesubject-matter experts
as well as those who are jacks of all

trades, understanding an operation

from a holistic perspective. Different
domains, such as geology, geophysics,
petrophysics, and drilling and
completions, are evolving toward a
common goal of improving overall
efficiency through collaboration on a
common platform. A driller needs to
understand the subsurface to optimize
drilling and a subsurface expert needs
to understand drilling limitations to
optimize well placement.
I moved from wireline to directional
drilling in 2005.
It couldnt have been a better time
to move from one domain to the other.
Operators were realizing the potential
of increasing well production through
high-angled profiles, and also, in India,
the focus moved from offshore to land
wells. Land wells offer a good career
buffer zone, where trainees can go as
additional hands and develop their
skills. The only downside was that I had
to start over again as a trainee.
Was it worth it? Yes.
The reason is simple: When we
graduate from college and get into a
particular domain, it is the best domain
available to us at the time, but we do

Vivek Sharma is the well engineering services manager for

Halliburton Consulting in the Asia Pacific region, where he is
in charge of a team of drilling engineers and geomechanics
specialists. He is also a subject-matter expert on industry
standard drilling software and drilling engineering and
conducts training courses on these subjects. With over 14
years experience in the upstream oil and gas industry across
leading service providers, Sharma has previously worked as
a wireline engineer, LWD (logging-while-drilling) engineer, senior directional
driller, and drilling advisor. He joined the oil industry after graduating in 2000 with a
bachelors degree in manufacturing process and automation engineering from Delhi
University, India. Currently, Sharma is based in Kuala Lumpur, Malaysia, where he
lives with his wife and daughter.

not know if we want to stay within it

throughout a long-term career. After
some experience, we learn about other
options available in the industry and
we want to try them out. Remember
the saying Grass looks greener on the
other side.
You will work on average 35 to 40
years before retiring. If after 3 or 4 years
you get the urge to change domains, you
could ask yourself: Would it be OK to
try it and not like it? Or not try it and then
regret it?
With 5 years experience, I could
have gone back to wireline anytime but
I chose to broaden my skills and stick to
drilling. Some of my colleagues pursued
their career with wireline and they
are now domain experts and product
champions; some became coordinators
and moved to bigger roles managing
multiple product service lines; some like
me changed domains but are continuing
in field operations. All of us have some
unique and satisfying career options
to pursue and that is what pursuing
multiple career options in the services
industry can do for you.
I made the transition from a multitude
of field roles to an office-based job
managing well engineering services for
Halliburton Consulting.
My field experience helps me
immensely with our clientsproviding
me with quick insight into understanding
how to tackle problems and then
guiding a team toward reaching the
optimumsolution.

The Decades Defining Moments

In my opinion, two major events have
defined drilling activity over the past
10years.
One is the rise in crude oil prices
from about USD 40/bbl to about
USD 100/bbl, with some declines in

Vol. 10 // No. 3 // 2014

17

Pillars of the Industry

2008 and 2009. The reason is due
largely to growth in demand from
developingeconomies.
The other, sadly, is the US Gulf
of Mexico Macondo blowout and
explosions on 20 April 2010 and the
associated aftereffects.
The bottom line, however, is that
crude oil prices have hovered between
USD 80 and USD 100/bbl since 2009 and
growth has continued in unconventional
and deepwater developments previously
considered economically marginal.
Unconventional refers to exploiting
shale or tight formations as a source of
hydrocarbons by means of inducing
fractures in the promising pay zones.
Such field development requires
extensive planningfrom seismic
through to stimulation.
Any such initiative requires the
cooperation of a multidisciplinary
team consisting of a geophysicist,
petrophysicist, geologist, reservoir
engineer, stimulation engineer,
geomechanics expert, and drilling and
completions engineer.
Deepwater exploration and
development is another important
activity that has increased in the past
10 years. There is an increase in rig
activity drilling in deep water reaching
3000 m. The cost of running deepwater
operations is much higher than onshore
or shallow-water operations, but
expoiting deepwater plays is justified
due to high crude prices.
After the Macondo incident, safety
regulations have become stricter.
Deepwater well designs have to
pass through level 1 and level 2
certification for an uncontrolled blowout.
Geomechanics has now become an
important consideration for well design
including pre-drill, real-time, and postdrill activities.
The company where I work provides
real-time pore-pressure analysis on
rigs and in their real-time operations
centers. In addition, different operators
across the world can see the same 3D
geomechanical model of a particular
field. A pre-drill, real-time, and postdrill geomechanical analysis is very
useful to ascertain the pore-pressure

18

profile and stress regime in the

wellbore. This results in safer drilling
practices, greater drilling efficiency, and
improved knowledge-sharing for better
in-situ modeling of well geomechanics.
What we have seen over the past 10
years is the integration of data with realtime operations. The approach toward
solutions is becoming increasingly
predictive rather than post-mortem.
Currently, we have software and
processing power that can perform
predictive modeling for a number
of outcomes at each exploration and
production stage, from reservoir
modeling to well design. Operators
are entering the field with more insight
than ever before. Even wildcat wells are
being drilled drawing insight from 3D
seismic data with much more information
about the subsurface compared to what
was previously available.
In addition, many new logging tools
and techniques are under development
to provide more subsurface information,
based on reservoir fluid sampling,
azimuthal and deep resistivity, micro
imaging, dipole sonic with multiple
wave data, neutron activation logs,
and more. These new technologies,
when interpreted correctly, can give
an operator better insight into where
to drill, how to drill, how to complete,
and how to produce the reservoir
mostefficiently.

What to Expect During

the Next 10 Years?
Over the next 10 years, we will continue
to see growth in unconventional and
deepwater activities. Mature field redevelopment, infill well drilling, and
improved recovery will also be areas of
continued growth going forward.
Digital oilfield will be the starting
point of any oil-and-gas-related activity
in the future.
Visualization platforms that can
integrate seismic, geologic, reservoir
and drilling data will give operators
the information with which to make
intelligent decisions; these integrated
information visualization platforms
hold the key to optimizing reservoir
performance. These digital oilfields

might be based on artificial intelligence

networks and could be self-learning.
The process has already begun; it
starts with larger operators entering
the process earlier and eventually
the technology percolates down to
smaller companies. The modules on the
visualization platforms will be updated
regularly as the new data comes from
field operations.
Exploration and development teams
of the future will be working as a team
more than ever before. Instead of each
domain having a vertical structure, there
will be a need to form horizontal teams
comprising personnel from several
different domains.
These teams would collectively
use the integrative digital oilfield
to maximize returns by simulating
all future activities to be carried
out over the life of the well. Under
such circumstances, old ideas and
methodologies for well management
would be subject to constant challenge
that could give way to strategies that
appear to be more effective.

Recommendations for EarlyCareer Professionals

Over the past 10 years we have seen
tremendous growth in the energy
industry, with unconventionals,
especially in the US, becoming
an economically and technically
viableoption.
Wells with increasing complexity
and depth (e.g., extended-reach
drilling) are being drilled today that
would have been unimaginable 10
years ago.
Such growth will continue to be
assisted by improvements in 3D
visualization techniques.
Safety and environmental
considerations will become more
defined and stringent as a result of
the loss of life and wealth due to the
Macondo incident that shook the
entireindustry.
The most significant contributions
will come from the mindsets of those
willing to change and adapt to new and
innovative ideas, however challenging
they might sound. TWA

SPE 101

How SPE Has Grown and Evolved During

The Way Aheads First Decade
Paulo Pires, Petrobras

In 2004, SPE assigned the first editorial

committee to The Way Ahead, whose
mission was to deliver, year in and year
out, a publication forand byyoung
professional E&P industry SPE members.
A decade later, you hold in your hands
proof of the success they and subsequent
editorial committees achieved: The
Way Ahead magazine is an established,
consistently excellent published
petroleum industry magazine.
The success of TWA in its first
decade is partially due to the significant
position that young professionals
strove for and now hold in the global
industry workforce. That was a profound
transformationbut not the only one
the industry experienced during
this period. The last 10 years have
also brought several changes to the
petroleum industrys economic and
technologicalscenarios.
What about SPE? What is SPE like
today compared to 10 years ago? Has SPE
really evolved in response to the changes
the industry faced during this time?
If you recently participated in
an SPE eventthe 2014 Annual
Technical Conference and Exhibition
in Amsterdam, for examplefrom
the number and origin of the other
attendees you met there, you probably
noticed how global SPE has become.
You might also have observed the
variety of technical themes covered and
the quality of presentations delivered.
Those impressions might be considered
evidence showing how the society has
grown especially during the last 10 years.
Today, when you visit the SPE website
and search for an event that matches your
interests, chances are you will notice
the diversity and number of options
available. By the time this issue is in your
hands, SPE will already have featured at
least 140 events during 2014. By the end

of 2014, SPE will have held more than

160 events all over the globe. This is
remarkable and makes it hard to imagine
that throughout 2005, when the first three
issues of TWA were written, printed, and
mailed, SPE held less than 40 events.
Membership has also shot up over
this 10-year period. In 2005, SPE could
count more than 69,000 professional and
student members. Over the last decade,
the number of professional and student
SPE members has jumped to more than
124,000 as of yearend 2013.
As a consequence of the membership
boom, new SPE sections were created in
different parts of the globe. When the first
issue of TWA was mailed to recipients,
there were 160 sections in 15 regions to
which members could affiliate worldwide.
As of yearend 2013, 196 sections in 16
regions helped SPE fulfill its mission,
fostering technical dissemination,
promoting networking, and supporting
the activities of youngprofessionals.
The next generations of petroleum
industry professionals also became more
represented in SPE. Ten years ago, there
were 150 student chapters at universities
around the world. Today, this number
has more than doubled, to 314. That level
of growth helps ensure the industry
will continue to bring in new insight
and energy during the next 10 years
andbeyond.
In the last decade, the petroleum
industry further steered its course
toward challenging opportunities both
technically and economically. Research
and technology advanced at full speed. In
that period, the number of SPE technical
publications also grew significantly.
Searching the OnePetro site, one can
find that the number of SPE papers more
than doubled between 2005 and 2013.
OnePetro has become so important today
that the library has been expanded to

include publications from other oil and

gas professional societies and publishers.
New regular publications also came
into being in response to our members
and the industrys needs. Between 2004
and 2014, the number of peer-reviewed
journals increased from five to six,
and during the same timeframe the
number of SPE print or online technical
magazines increased from one [the
Journal of Petroleum Technology (print
and online)] to four, with the addition of
Oil & Gas Facilities (print and online) in
2012, The Way Ahead (print and online) in
2005, and HSE Now (online only) in 2012.
The society frequently launches new
online resources as well. Good examples
are Petrowikithe online petroleum
encyclopedia, with content from SPEs
authoritative Petroleum Engineering
Handbookand SPE Connecta
professional network available to all SPE
members, including students. These
resources are intended to make essential
technical information available to all and
to promote networking and technically
based discussions between members.
Other SPE programs, such as
energy4me and eMentoring, provide
educational resources and help prepare
new generations for the industry. Rest
assured that new events and programs
will be organized with purposes
determined by future industry needs.
TWAs achievements during its first
decade of existence have occurred
against the backdrop of SPEs intense
growth. Looking back, its impossible not
to feel confident about the years to come.
The society continually plays a significant
role in driving the industry toward
technical excellence and high operational
standardsand will continue to do so for
the next 10 years. And you are part of that
growth toward excellence, so please join
us and well work together. TWA

Vol. 10 // No. 3 // 2014

19

Discover a Career

Discover a Career in Social Media

Olivia Harting and Erika Conner, Chevron

One thing social media professionals

have in common is that our jobs
didntexist a decade ago. Now,
social media professionals play a
vital stakeholder-engagement role
in marketing and communications
acrossalmost all industries, including
oilandgas.
However, oil and gas social media
professionals face challenges not all
industries share.
Like other industries, we help build
brand recognition and favorability
in the online space. But we also
have the difficult task of educating
people about oil and gas and also of
explaining how our companyand the
industrycreates human prosperity
and brings value to the communities
where we operate around the Earth.
We help our company connect
with hard-to-reachinfluencers,
and engageopinionleaders,
policymakers,community
stakeholders,and nongovernmental
organizations (NGOs) on complex
issuesso our companyand the
industrycan gain acceptance
in orderto operate within difficult
political, sociopolitical, and/or
geopoliticalclimates.

What Is Social Media?

Social media is the interaction between
people (social) who use various electronic
communication technologies (mediathe
plural of medium), any one of which
enables the interaction to take place
as fast as an instant, like a face-to-face
conversation, across vast distances on
Earth. Communication via social media
sometimes reaches nobody, or can reach
one, two, or potentially even a billion or
more people. Using social media, people
can communicate opinions, information,
photos, video, Internet links, game
moves, and experiences through email,
instant messages, and texts; blogs and
microblogs; forums, chat rooms, and
networking sites; multi-player games;
wikis; social bookmarking; and many
other electronically enabled means.
New and ever-faster electronic
communication technologies (e.g., cell
phones, cameras, audio, video, tablets,
laptops, servers, cables, satellites) and
platforms (e.g., apps, operating systems,
software programs, the Internet and
its myriad types of sites) now allow
instantaneous worldwide personal
connection between human beings
something never experienced on such
a huge scale by humanity. Social media

Olivia Harting is the social media lead for Chevron

corporate public affairs. She helps guide the strategic use of
social media in corporate communications, online
stakeholder engagement, advocacy campaigns, issues
management, and crisis communications, and helps build
organizational capability in digital and social media among
the companys public affairs communicators. She currently
serves as the Chevron chairperson to the Social Media
Business Council ([Link]). Harting has 18 years experience in interactive
media and digital marketing. She began her career in social media as a community
manager overseeing Chevrons proprietary online energy forum in 2006. Harting
earned a BA degree (magna cum laude) in philosophy from Wellesley College,
Wellesley, Massachusetts. She has taken advanced-degree classes in computer
graphics and interactive media at Pratt Institute, Brooklyn, New York.

20

allows human interaction to happen

at lightning speed and continuous
frequency through virtually simultaneous
reach over vast distances among
enormous and geographically scattered
audiences. Social media is changing how
we relate to other human beingsour
friends, families, communitiesand even
how we experience ourselves. And its
changing the relationships companies
and industries have with their customers,
stakeholders, employees, and others all
over the world.

Why Social Media Matters

The global Internet population is
made up of approximately 2.4 billion
people, estimates data consulting firm
Domo. According to Business Insider
Intelligence, in the US alone, people
spend more time on social media than on
any other major Internet activity.
Congressional Management
Foundation and Brunswick Group
surveys indicate that the news media,
investors, government officials and
staffers, NGOs, academics, and opinion
leaders are increasingly using social
media platforms (e.g., blogs, Twitter,
LinkedIn, Google+, Wikipedia) to
conduct research, share information, and
connect with their peers and constituents.
These audiences are key stakeholders
in the oil and gas industry. Social media
thus allows oil and gas companies to
engage with theseinfluencers across
multiple platforms whose value the
influencers already understand.
For example, in ranking their top
information sources, investors surveyed
by four organizations (Brunswick Insight,
Cogent Research, FTI Consulting, and
Unversitat Leipzig) said companies
that directly communicate information
matter more than any other source. Of
investors surveyed by Brunswick Insight,
52% read blogs, 30% use Twitter, and

73% say they use LinkedIn to research

financialdecisions.
Knowing this, oil and gas social media
professionals can amplify and reinforce
the information they normally provide
investors through formal engagement
channels by also using online channels.
Social media gives its practitioners the
ability to target their communications
efforts online and, in todays electronic
world, be at the right place at the
righttime.
Not everyone understands the
complexities of the oil and gas industry.
Social media provides many avenues
for bringing credible information to the
online conversation. Through social
media, we can help people understand
not only the value the industry brings
to millions of lives across the globe, but
also all aspects of the businessfrom
base exploration and production to our
community relationships to how gasoline
gets to their cars tank. We can also
leverage our social media platforms
to confront misconceptions, correct
inaccurate information, and participate
in public discussion and debate about
energy issues.

How Do We Use Social Media?

According to online statistics gathered
by Domo, the following happens every
minute of every day: 277,000 tweets
are shared, 72 hours of new video are
uploaded to YouTube, Google receives
over 4 million search queries, and almost
2.5 million pieces of content are shared
on Facebookevery minute of every day.

This massive amount of social media

data provides companies with two very
valuable business opportunities. The
first is the ability to listen to the online
conversation in order gather digital
intelligence relevant to the business. The
other is to engage key stakeholders
and influencers in a meaningful brand
experience and dialogue.

Listening
A key component of the social media
professionals role is to monitor what is
occurring in the online space; analyze
what we encounter to determine what
types of data or information relate most
closely to our companys concerns;
and glean insights, examples, and
recommendations that can affect
business outcomes.
Individuals and organizations
throughout the world discuss energy
issues online. By listening to social
media conversations, we are able
to gather information that allows us
to identify key influencers, trends,
emerging issues, and potential threats
to our operations. Listening enables
us to make better-informed business
decisions and develop more proactive
overall communication strategies.
Moreover, online listening allows us to
actually track behavior and stakeholder
actions as opposed to formally using
a poll or survey to measure public
opinion or intent. As our ability to track
actual behaviors grows, so too will our
ability to better predict the actions of our
keystakeholders.

Erika Conner is the social media community manager for

Chevron corporate public affairs. Conner is responsible for
social media community management across Chevrons
corporate social media platforms. She oversees community
moderation and proactive stakeholder engagement. Conners
responsibilities also include analyzing community insights,
spotting trends, identifying and reporting on ongoing issues,
and monitoring social and digital information related to crisis
situations. She has more than 12 years of combined experience in the areas of
journalism, digital content creation, video production, and website and social media
management. She is a two-time Emmy Award winner and a recipient of an
EdwardR. Murrow Award. Conner earned a BA degree in English at the
Universityof California, Santa Barbara, and an MS degree in broadcast journalism
at Boston University.

We rely on a variety of tools to listen,

monitor, and manage social media.
These tools help organize, categorize,
and identify which relevant information
is of the greatest value to our business.
Typically these are cloud-based tools
that draw on the millions of online
conversations across countless platforms
to provide us with everything from
conversation analysis, trends, emerging
issues, and cyber-threat warnings; to
stakeholder mapping and identification;
to brand impersonation and trademark
violations; to content analysis, content
scheduling, and publishing.

Engagement
Embracing social media means more
than just broadcasting corporate
messages: It strengthens a companys
ability to build trust and favorability with
its audiences. For example, according
to the 2013 Trust Barometer, based on
a global study by public relations firm
Edelman, 82% of millennials said they
would have more faith in a company
or institution if they were involved in
socialmedia.
In our business, we engage with
the goal of building relationships and
communities that support our company
and the industry. By listening across
all our social media platforms to our
audiences and understanding who they
are, were able to create relevant, timely,
and informative content that delivers key
messages and that amplifies business
information. We aim to use photos,
infographics, articles, and facts to drive
positive awareness and advance our
companys reputation.
During times of crisis, listening and
engaging via social media is critical to
understand what questions individuals
have regarding the situation and also to
convey status updates. Social media is
also important when were sponsoring
an event, publishing a press release, or
making an announcement. The ability
to engage with millions of people at a
time on a personal level is powerful and
unlike anything weve been able to do in
yearspast.

Vol. 10 // No. 3 // 2014

21

Discover a Career
A Career in Social Media
Anyone considering a career in social
media should keep in mind that its
a very fast-moving, ever-emerging,
and evolving space. It requires a
passionfor technology and data, a
passion for storytelling, and a passion
for connectingpeopleand connecting
withpeople. It requires constant
learningand the ability to adapt
tochange.
The job literally requires 24/7
management and attention because itis
always daytime somewhere in theworld
and, therefore, social mediacan
neversleep.
Because the work requires
aptitudein a variety of disciplines,
social media professionals come from
a wide varietyof communications
backgroundsmarketing, media
relations, public affairs, journalism,
and interactive program management,
to name a few. In turn, a career in the
communications or marketing fields
today requires an understanding
of social media. Social media

professionalshave become critical

business partners.
A career in social media is both
challenging and rewarding. The
challenges stem from the fact that
this field is always changing. Time
is spent daily to understand new
functionality and emerging platforms for
stakeholderengagement.
Understanding and implementing
big data analytics and how we can best
leverage digital intelligence to improve
business outcomes are areas of great
opportunity, but they are multifaceted
and can be challenging tonavigate.
Its often challenging, too, to
produceand curate the volume of rich
and compelling content needed to feed
all channels on a daily basis. Content
creation and coordination can be a
significant aspect of the social media
community managers job.
But the challenges of these roles
also feed into the rewards that make a
career in social media exciting and make
each day unique. To analyze data in a
way that provides the greatest business

value, or to tell a rich, compelling

storyonline, we first have to understand
howthe information we glean can
translate into business opportunities.
While we are digital and social
media specialists, were not subjectmatter experts about the business
and all its many facets. Wetherefore
collaborateclosely with team
membersthroughout the companyon
a daily basis. Being at the center of
external stakeholder communication
allows us to work with subject-matter
experts who provideinsight into our
companys different lines of business
and the valuethese various businesses
bring tothe company as well as the
challengestheyface.
Social media is constantly
changingand we cannot predict theways
companies, including those in the oil and
gas industry, will use digitaltoolsand
technology in the [Link] we do
know for now is that social media is vitally
affecting thewaywe communicate and
listentothe world community in which
welive. TWA

Dig deeper without leaving your desk.

Too busy to be away from the ofce? Take yourself to greater depths right from your desktop with
SPE Web Events. Join our industry experts as they explore solutions to real problems and discuss trending topics.
View a list of available web events at [Link]/events/webevents.
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22

Technical Leaders

The Past and Future Decade: Industry

Leaders Speak Their Minds
Luis Rodriquez, Rex Energy and Eve Sprunt, Consultant

Question: What do you think wasthe

major industry focus area overthelast
decade in terms of oil and gas resources:
conventional, deepwater, heavy oil, shale?
Could it shift in the nextdecade?
LR: I think the answer depends
on the energy needs of the
nationsinvolvedandthe resources
available to them. For instance, Brazil
has developed impressivetechnology
and capabilities in the lastdecadefor
deepwater resources [Link] US
has been successful with unconventionals
(shales, tighthydrocarbons, etc.). I think
the industry will continue to develop new
technology and the next shift in focus
will be towards developing resources
that will become available due to
implementing that new technology.
ES: Shale resources huge impact was
the big surprise of the last decade. Shale
resources have had a major economic
and geopolitical impact and will continue
to do so in the coming decade.
Question: Whatnovel technology
emerged in your area of expertise in the
last decade? What was its impact?
LR: Hydraulic fracturing has been
evolving for the last several decades, not

just the last one. However, it has been in the

last decade that all the variables required
finally fell into place. A combination
of new drilling technologies made
horizontal wells economically viable
new developments in rock mechanics
that improved the understanding of how
fractures develop in the rock, new ideas in
fluid mechanics that allowed us to improve
fracturing fluids. All those technologies
allowed for the shale revolution to
occur and increase production from
unconventional resources fourfold. In
2008, accordingto the EIA [US Energy
InformationAdministration], unconventional
production accounted for 12% of total US
crude oil production. Today it accounts for
more than 35%.
ES: The shale revolution has revealed
how much we have yet to learn. Our
understanding of hydrocarbon migration
is very incomplete. To more efficiently
find and produce hydrocarbons, we need
to better understand natural hydrocarbon
migration. Hydraulic fracturing is a
big hammer, but we need to better
understand the role of natural fractures
on all scales over time to become more
efficient. Remote sensing technologies
may be an attractive way to identify areas
of higher natural fracture density that are
sweet spots in shale resources.

Luis Rodriguez is vice president of reservoir engineering at

Rex Energy Corporation. He has over 15 years experience in
the oil and gas industry, working in different positions ranging
from production and operations to reservoir engineering and
management. Rodriguez has worked in assets such as the San
Jorge basin in the South Patagonian region of Argentina; the
Cano Limon field in Colombia; the Hugoton gas field in Kansas,
USA; the San Joaquin basin in California, USA; and the
Marcellus shale, USA. Luis holds a BS in petroleum engineering from Universidad
Industrial de Santander in Colombia, an MS in petroleum engineering from the
University of Oklahoma, and an MBA from Rice University.

Question: How have job hiring trends

for the industry changed over the last
10 years? How do you think these trends
will change over the next decade and
what advice can you give to young
professionals planning to enter the
industry in the coming years?
LR: During the last decade the industry
faced a difficult situation, as its experts
and technological leaders aged and
began to retire. Young professionals
entry into the energy sector has not been
enough to replenish the retired force.
Hiring trends today reflect that. A lot of
engineers and experts all over the world
are moving to the US to fill the gap.
My advice to new engineers is you
need to find a focus area and select
your future direction based on that.
For instance, if you want to become a
reservoir engineer leader, you may seek
a position with an operator that has a
lot of experience and/or leading-edge
technology in old and new fields. If you
want to become a drilling engineer
leader, your first move may probably be
with a service company that specializes
in that area. Dont let a company manage
your career; rather, move to the company
that you think will focus your skills better
and allow yourself to be the manager
of your career. In the end it all depends
on whatyou want to doas clichd as it
maysound.
ES: When the industry started hiring
again about a decade ago, enrolments
in university petroleum engineering
programs were low, because of the low
levels of hiring during the previous 2
decades. The pattern was very similar
to what occurred in the 1970s when
the petroleum industry re-staffed after
a couple of decades of low petroleum
prices and low hiring. Companies dont

Vol. 10 // No. 3 // 2014

23

Technical Leaders
hire because their workforce is aging,
they hire because business is booming
and operations are expanding.
Every industry has its booms and
busts, so we all need to have strategies
to survive both periods of frantic activity
and times of layoffs. Being active in SPE
is a good strategy and was a critical part
of my toolbox. Building connections and
a network beyond your own employer
creates a safety net of people who know
your capabilities and work ethics. In
hard times, most good jobs are obtained
through personal networks. Over a 30or 40-year career, you can expect that
you will encounter at least one major
downturn when having a strong personal
network helps you stay employed.

requires more support, because both

partners careers must be considered
and there is not a supporting spouseto
manage the logistics. Dual-career couples
also need more flexibility on a daily basis
because no one is at home to manage all
the unexpectedevents.

ES: Employers will try to leverage other

factors to make themselves attractive.
Training programs and certain earlycareer opportunities can be very enticing.

LR: I think that the Macondo disaster may

be the consensus as the most significant.
The Deepwater Horizon oil spill simply
shook the industry to its core. In just a
moment, the industry was reminded
not only that they are responsible for
human lives and of their environmental
and safety responsibility, but that their
companiesno matter how bigare not
too big to fail. We are neither banks nor
car manufacturers. A single event could
destroy all the value added for decades,
in an instant. The government will not
or cannotcome to our rescue; they
simply lack the technical expertise to
address a situation like this.
Perhaps one of the most important
lessons learned is in the areas of deepspill decontamination and the analysis of
oil spills impact on the environment. For
example, new and quicker methods to
test for contamination in marine animals
were developed and validated by the
US Food and Drug Administration. The
solution to the Macondo event was truly
an example of cooperation between
industry, government, andscientists.

Question: What do you think about the

quality of industry job candidates now
versus the past decade?

Question: What are the major workforce

changes you have seen and what are
companies doing to accommodate the
changing workforce?

LR: A lot of different opinions exist. The

consensus is that the new candidates
somehow lack the knowledge and
preparation that previous generations
had. I disagree. The new generations are
better at using new tools and technology
that just a few years ago were not available.
This multiplies their performance in ways
that are quite surprising. I only expect
new candidates will become increasingly
better. One issue remains constant
though: Some skills are acquired only
throughexperience.

LR: By far, retirement. We are losing our

best engineers and knowledge to the
aging cycle and we have not been able to
adapt quickly enough. According to the
latest SPE survey, the average age of a US
petroleum engineer is 46. Companies are
bringing new engineers from overseas,
increasing their investment in universities
and colleges in order to capture thebest
candidates, creating in-house programs to
train engineers in petroleum engineering
areas, etc. Only time will tell if current
efforts will help overcome thetrend.

ES: Higher enrolments of students in

disciplines of interest to the petroleum
industry mean that employers can be
more selective. Also, with more students
studying petroleum engineering, there
are more high-quality candidates.

ES: The younger workforce is

increasingly composed of people
who are part of a dual-career couple.
Previously, much of the workforce
had a spouse who handled household
logistics. Relocation of people in dualcareer couples is more complicated and

Question: With the increasingly higher

(and arguably unsustainable) starting
salaries for new graduate hires, how do
you see recruiting strategies changing so
companies can obtain the best talent?
LR: This is simply an asset allocation
issue. If the energy industry provides
better returns than, lets say, the
telecommunications industry, then it will
offer better salaries to capture the best

24

talent. This is happening now. However,

the situation can change. If for some
reason commodity prices plummet, it is
very likely that recruiting strategies and
new-hire salaries will adjust accordingly.
Using the same logic, we can easily
understand how Wall Street now offers
higher bonuses than the oil industryand
how that situation was reversed during the
2008 economic crisis. Today our industry
offers higher salaries simply because it
can, and we want the candidates.

Question: What are the major disasters/

accidents that have occurred in the
industry in the past decade and what
have we learned from them?

ES: The Macondo blowout has had a

tremendous impact in the industry. It
has revealed many of the gaps in our

Eve Sprunt, a consultant, has 35 years experience working in

various technical and leadership roles for major oil companies,
including Chevron and Mobil. She was president of SPE in 2006
and was made an Honorary Member of SPE in 2010. In 2013,
Sprunt was honored by the Society of Women Engineers with
the Achievement Award, their highest award. She earned BS
and MS degrees in Earth and planetary sciences at
Massachusetts Institute of Technology and a PhD degree in
geophysics at Stanford University.

safety culture. Employees must be better

trained and feel empowered to insist that
work be stopped when unsafe situations
arise. Safety incidents are more common
with a less-experienced workforce.
Question: How has environmental
regulation changed in the past decade?
Can we expect tighter regulation in
thefuture?
LR: Perhaps one of the most significant
areas of change is emissions control
particularly CO2 emissions. Earlier
this year [2014], the US Environmental
Protection Agency proposed a plan
that aims to slash carbon dioxide
emissions by 30% from power plants
by 2030. Several US states, including
California, are thinking of or already
implementing cap-and-trade schemes
to control CO2 emissions. Carbon taxes
are being discussed and proposed in the
legislature. I think the tendency is clear
and we can expect tighter regulation in
the future.
ES: Environmental regulation and
monitoring requirements have increased
and will continue to increase. We must
acknowledge that everything has
an impact. Waste disposal can have
previously unrecognized consequences,
so whenever possible we should recycle
and reuse supplies to minimize waste.
Question: Do you foresee more company
spinoffs or mergers in thefuture?
LR: Yes. It all depends on the market
situation. Generally speaking, companies
tend to merge when commodity prices
are lowthis is what happened in 1998
2000. Spinoffs, on the other hand, tend to
happen when assets inside a corporation
become too diverse or their risk profiles
become too heterogeneous. There is,
however, no definitive rule for mergers
and spinoffs. In any case, Im sure we will
see mergers and spinoffs in the future.
ES: Yes. Companies will continue to
evolve to better compete in the world
market. No matter how large your
employer or how secure your position

appears, you always need to be prepared

to look for another job. Network and keep
your rsum up-to-date!
Question: What is the biggestchallenge
you see the industry as a wholefacingin
the future: environmental regulation,
public perception, personnel shortage?
LR: My answer: all of the above.
Public perception creates a cycle that
affects the industry in all areas. When
people see the industry as big oil
or the big bad wolf, the tendency
is to increase regulation that affects
usenvironmental, taxes, safety, areas
opento drilling, [Link] the
tendency is to thinkcompanies within the
industry will take advantage of people.
This also causes fewer enrolments in
engineering schools or departments
related to the energy sectornobody
wants to work for a polluting, despicable
industrycreating personnel shortages
and technological challenges due to
reduction in R&D.
I think it is important for us to clarify
this situation. For instance, the main
factor that allowed the US to reduce its
CO2 emissions in the last decade was the
shale gas revolution. According to the
[European Commission Joint Research
Centre] Emissions Database for Global
Atmospheric Research, the US emitted
about 6 billion metric tons of CO2 in 2004
against roughly 5 billion in 2012. About
17% reduction in 8 years. Compare that
to the EPA-proposed 30% reduction by
2030 or to the emissions coming from
China: in excess of 10 billion metric tons
of CO2.
Some people thought the US CO2
emissions reduction was due to the2008
recession. But they continue to decline
today, way after the recession is over.I
believe the increased use of cleaner
natural gas is already showing some
benefits. Even years before the proposed
EPA CO2 emissions reduction plan,
companies generating electricity began
moving from coal-powered plants to
using combined-cycle plants powered
by natural gas. Public opinion seems to
ignore all this and attribute good results
to government policies.

ES: Societal license to operate is the

biggest challenge. Every form of energy
has an impact, but environmental activists
have particularly targeted fossil fuels.
We need to better communicate how the
petroleum industry enables modern life,
while simultaneously minimizing our
environmental impact and improving our
safety record.
Question: What other major changes in
the oil and gas industry do you foresee?
LR: The biggest change the industry
faces is the move towards cleaner fuels.
This has happened several times in
history. For eons, we used long-chained
hydrocarbons, such as wood, as fuel. A
few centuries ago we started burning
shorter hydrocarbons, although still longchained: coal. Recently, with internal
combustion engines, we switched to
even shorter hydrocarbons: crude oil.
We are in the middle of the shale gas
revolution, a transition towards really
short-chained hydrocarbons: natural gas,
propane, and butane.
Several leaders within the oil and
gas industry are advocates of moving
the US from an oil-dependent economy
to a gas-dependent economy. T. Boone
Pickens and Harold Hamm come to
mind. This transition faces several
challengesfor instance, transportation.
Gas is compressible and not as easy to
transport as oil. The US currently lacks
the infrastructure to massively distribute
natural gasfor example, to gas stations
around the country. Countries like Brazil
run not just buses, but regular family
vehicles, on natural gas. You can fill up
your natural gas tank easily anyplace
inside Brazil, but not in the US. The good
news is the industry is already moving
in that direction and, like in the past, it
will rise to the challenge and will be an
integral part of solving our energy needs.
ES: Collection and interpretation of big
data will become increasinglyimportant.
We currently place a great deal of
reliance on seismic. Integration of other
types of data collected by satellites,
airplanes, anddrones may open the door
to lower-cost evaluation. TWA

Vol. 10 // No. 3 // 2014

25

Soft Skills

Is the Industry Ready for a Change

inLeadership?
Partha Ghosh and Olivier Soupa, Schlumberger Business Consulting

The oil and gas exploration and

production (E&P) sector has made a
U-turn over the past 10 yearschanging
from an industry dominated by those
over 40 into a more youthful one.
For the vertically integrated majors,
this generational shift in its human
resources (HR) has taken place while the
companies were managing increasingly
technically challenging upstream
projects and being answerable to
stronger safety and environmental
regulation. Few industries have
experienced such a profound upheaval.
The generational shift in industry
personnel is the so-called big crew
change that is occurring now, as the
peer group of engineers hired before
the recruitment cuts in the mid-1980s
began to retire around 2005. Fig.1
illustrates the massive outflow of senior
petrotechnical professionals (PTPs)
from the industry and a corresponding
increase in younger, inexperienced
graduate recruits.
Since around 2005, the dearth
of experience among their human
resources has forced E&P companies
to rethink the way they manage their
talent, putting HR issues at the top of

25%
2005

15%
10%
5%
0%
20y-24y 25y-29y 30y-34y 35y-39y 40y-44y 45y-49y 50y-54y 55y-59y 60y-64y 65y+

Fig. 1Demographic swing (percentage of petrotechnical professionals

peragegroup) between 2005 and 2013.
their agenda. Over the past 10 years,
companies have focused their efforts on
planning manpower needs, reinforcing
recruitment capabilities, and fast-tracking
skills development, while designing more
attractive careers in an effort to better
retain their best employees.
Today, the following appear to be
themain HR concerns of most oil and
gas companies:
L
 eadershipMost oil and gas
companies remain reluctant to
entrust people younger than those
hired in the past with similar sets of
responsibilities.

Partha Ghosh is a senior advisor to Schlumberger Business

Consulting. Ghosh has more than 35 years of management
consulting experience in technology-based and energy
industries across the Americas, Africa, Asia, Australia,
Europe, and the Middle East. He currently focuses on strategic, innovation, and leadership issues in the energy industry.
From 1977 to 1990, Ghosh was a partner at McKinsey &
Company, after which he ran his own boutique advisory
firmPartha S. Ghosh & Associatesfocusing on policy and
strategic issues. He holds a bachelors degree in chemical engineering from the
Indian Institute of Technology, and two advanced engineering and management
degrees from the Massachusetts Institute of Technology.

26

2013

20%

D
 iversity and InclusionThere
is lower-than-expected growth in
areas such as gender and local
content.
K
 nowledge-Sharing/TransferNot only from senior
to junior staff but also between
developed and developing
countries, this is proving more
difficult than expected.

Developing a New Approach

to Leadership
Although engineering programs at
North American universities are running
at capacity, many of the most talented
engineers are reluctant to enter the oil
and gas industry. This is partly due
to the less appealing public image of
the E&P industry, when compared to
others. Additional reasons include an
increasingly widening gap between
professional progression within E&P
and that of other industries such as
high-tech or finance, as well as the
harsher lifestyle of some oil and gas
careers. For example, a recent oil and
gas graduate may be required to live
and work in unfavorable remote areas,

whereas a graduate entering a tech

company may be working at a plush
ultramoderncampus.
This trend, along with the
unsustainable succession of
successions that accompanies the
replacement of top executiveslike a
series of musical chairsare pushing
the industry to rethink its leadership
approach. (Fig. 2 illustrates the
industrys historical and forecast
requirements for leadership.) The
need for leaders in the next couple of
years is greater than it has ever been in
thiscentury.
The industry must revise its approach
to career development and take more
risks with younger people. A few
companies have begun succession
planning and this wave of change
is needed in the middle- and topmanagement layers: among heads of
assets, heads of technical and support
functions, and their subordinates.
Rejuvenating the population of leaders
will create a unique opportunity to
increase the attractiveness of the sector.
Critical to the successful identification
and development of future leaders
is an intimate understanding of the
existing talent pool. The most successful
companies have developed approaches
under which a specific function is
managed closely by a dedicated
organization. Individual talents are
identified and followed, ensuring their
suitability to leadership is strongly
backed up by a skillpoolorganization.

Diversity and Inclusion

Lagging Behind
Gender diversity has improved in recent
years, but the E&P industry is far from
being able to proclaim success in this
area, with the number of women seldom
exceeding 20% of overall engineering
staff. Counterintuitively, it is in the regions
and company types where women
are usually excluded from positions of
responsibility that the most progress is
being reported, such as in the Middle
East and at national oil companies,
whilst international oil companies
remain surprisingly conservative in
recruitingwomen (Fig. 3).

+60%

+20/45%
1,500

900
[500750]

20052009

20052009

20052009

Fig. 2Comparison between historic and forecast need for leaders in the oil and
gas E&P sector (annual average number).
A hot topic regarding diversity
and inclusion in the industry today is
national content or local content as it
is popularly referred to. After decades
of operations in remote locations, the
number of locally recruited employees
remains far below the desired level. To
address this imbalance some resourcerich countries have implemented quotas
forcing companies to recruit locally.
But despite tangible results, this policy
has proved partially counterproductive
for several reasons. First, quantitative
targets encourage companies to recruit
quickly for lower-skilled support functions. Second, quotas usually apply
to the production phase. In many
cases thelargest potential for local job
creation is during construction when
the employers are not E&P operators
but engineering, construction, and
supplycompanies.

Third, imposing quotas without

investment in national education does
not support robust devel-opment of a
skilled generation. Too often quotas are
used to shift the onus for education from
governments to operators. Also, quotas
can result in unfair and suboptimal
utilization of human resources as not all
companies pursue people development
policies or contribute to talent pool
growth by training young graduates,
but rather exclusively poach midcareertalent.

Collaborative Approaches to
Knowledge Transfer Are Lacking
The struggle for talent in resource-rich
developing countrieswhere local
education systems produce neither the
quantity nor quality of required human
resourceshas been intense during
the past decade. Underinvestment in

Olivier Soupa is a principal at Schlumberger Business

Consulting. With more than 10 years of management
consulting experience, Soupa specializes in organization
and human resources, with an emphasis on post-merger
integration, restructuring organizations, and designing
human resources strategies. He assisted in creating the
Schlumberger Business Consulting Energy Institute, a
nonprofit foundation whose purpose is to work on scientific
and technology research on the worlds future energy
challenges. As the managing director of this institute, Soupa focused on energy
supply challenges, covering oil and gas as well as low-carbon energies.

Vol. 10 // No. 3 // 2014

27

Soft Skills
24%

2005
2012

22%
18%

16%

15%

14%

NOC

Major

Independent

Fig. 3Petrotechnical professionals in the E&P industry who are women

(percentageofrespondents).
~x10

x6-x8

Min/Max
x2-x4

Direct

Indirect

Induced

Total new jobs

Fig. 4Ratio between direct, indirect, and induced jobs generated in

theoilandgas industry.
education has many causes, but the main
one is lack of appetite among decision
makers and operators to invest in longterm benefits. There is also a staggering
lack of collaboration among international
operators and poor coordination
of educational initiatives by local
publicadministrations.
All stakeholders acknowledge that
education must come first, but they
continue to fight over who will pay:
Host governments refuse to integrate
education investments by E&P operators
into cost recovery; consequently,
the companies finance only a few
scholarships. The operators themselves
do not work together to implement
long-term strategies that would bring
benefits for all. Several African countries
could have hosted international centers
of excellence for oil and gas, led and
coordinated by a community of IOCs
and national bodies. But instead, the
focus remains on secondary details,

28

such as which education model

should prevailAnglo-Saxon or
continentalEuropean.
Moreover, investments in education
have not targeted disciplines with the
largest potential for job creation (Fig.4).
Alarge E&P project requires top
petroleum and geoscience engineers,
but far more mechanical or electrical
engineers are required. And many more
technicians and craftsmen are needed
than pure engineers.
Investments in education deriving
from oil and gas projects usually address
only petroleum disciplines and seldom
include technicians. Broadening the
scope of education investment to meet
the most acute needs could benefit the
wealth and long-term development of
emerging economies.

Conclusion
Implementing one or more of several
strategic initiatives could shape the

next decade of the oil and gas industry

in a positive way:
Companies boards of directors
and CEOs should increasingly focus
on discussing ways employees
can develop organizational and
leadership skill sets.
The evolution of the HR function
from responsive to proactive must
continue. CEOs and boards should
work as closely with HR as they
do with the companys technical
functions or operations.
Rejuvenation of leadershipdevelopment programs:
Companies should cultivate a
leadership culture to ensure
all employees feel genuinely
responsible for the domain of their
influence, from the immediate areas
of interest to societal obligations
as well; evolve a high level of commitment to performance; and, at the
same time, go beyond incremental
improvements and search for
and implement changes that
have the potential to revolutionize
theindustry.
Commitment to cultivate a culture
of innovation: E&P companies
are exploring ways to commit
increasing resources to research
and development, which, without
a culture that breeds imagination,
may not unleash their full potential.
Nurturing the culture of innovation
that can deliver game-changing
ideas will require uncompromising
dedication from leadership.
New paradigm of engagement
with education infrastructure:
companies must learn to work
with governments and educational
institutions to develop the quality
and quantity of skills needed by the
oil and gas sector to ensure supply
of these critical resources.
If E&P companies commit to some
or all of these strategic initiatives, a
differently modeled industry could
emerge that might enjoy significantly
more intellectual ferment and, in turn,
could be presented with opportunities
that could rejuvenate the industry. TWA

Tech 101

Artificial Lift: Focus on Hydraulic

Submersible Pumps
Abhishek Bhatia and Scott A.L. McAllister, ClydeUnion Pumps
Artificial lift is a technique used to
provide energy to the formation
fluids in a production well when the
pressure of the formation is not high
enough for hydrocarbons to flow up
the tubing string at an economic rate.
Several types of artificial lift can be
used to increase the production rate
and maximize hydrocarbon recovery.
The major artificial lift technologies
are beam pumping/sucker rod pumps
(rod lift), progressive cavity pumps,
hydraulic submersible pumps, electric
submersible pumps, and gas lift.
Hydraulic submersible pumps (HSPs)
(Fig.1) are hydraulic turbine-driven
downhole pumps that were developed
as an alternative to the more commonly
used electric motor-driven submersible
(centrifugal or progressive cavity) pumps
(ESPs). ESPs are used extensively in oil
lift applicationsparticularly offshore.
These pumps can experience failures
attributable to thefollowing:
Exceeding the limits they were
designed to operate within
Electrical insulation failure in the
wet well environment
Sub-optimal field practices
Overheating of the downhole
electricmotor
Particularly in the case of
high operating-expense (OPEX)

Fig. 1Hydraulic submersible pump.

Courtesy of ClydeUnion Pumps.

environments such as subsea wells,

faced with increasing demand for everdepleting resources, and the challenges
associated with oil and gas production in
increasingly difficult locations, there is a
strong drive to maximize hydrocarbon
recovery and lower operating costs
through improvements in well pump
technology. HSP technology has
demonstrated a step change in pump
mean time to failure (MTTF), validated
through more than 13 years of subsea
field operating experience. This presents
a viable alternative for operators can
consider to help improve their OPEX

Abhishek Bhatia, a mechanical engineer at SPX, is primarily

responsible for assessing hydraulic submersible pumps
(HSPs) appropriateness in different applications by engaging
early with endusers or field development consultants. His
current role also includes carrying out detailed hydraulic
studies, well modeling, selecting optimum HSP configuration
during pre-FEED and FEED stages, and mechanical design. In
his previous role, he was involved with the design and
packaging of surface pumps, typically used for water injection, crude export, and
seawater-lift applications. He holds a BEng (Hons.) degree in aero-mechanical
engineering from the University of Strathclyde and an MSc degree in design of rotating
machines from the Cranfield University.

profiles through the use of a highintegrity engineered pumping solution.

How Does an HSP Work?

A turbine-driven HSP is powered by
pressurised power fluid supplied
from pumps on the surface. The highpressure power fluid flows down a
dedicated supply flowline and enters the
tree at a controlled pressure and flow
rate. In the most common open loop
configuration, the power fluid enters the
HSP through the well annulus and depressurises through the multistage, axial
flow turbine, providing the drive to the
pump end to boost the pressure of the
formation fluids, (Fig. 2). The produced
fluid at pump discharge subsequently
commingles with the exhausted turbine
power fluid and flows up through the
production tubing, flowline, and riser
to the surface facilities. At this point, the
power fluid is then separated, filtered,
and recirculated back into the HSP power
fluid supply and water disposal system.
Another option is to supply power fluid
in a closed loop, where the power fluid
does not commingle with the formation
fluids. Although this is a more complex

Vol. 10 // No. 3 // 2014

29

Tech 101
completion design, with two concentric
annuli required for the independent
supply and return of power fluid, it
minimizes the load on the primary oil/
water separation facilities.

Power fluid pump

Cyclone

HSP Differentiators
An HSP differs from other artificial lift
technologies due to a number of factors:
Wide Operating EnvelopeThe
power fluid supply not only drives
the turbine but provides a hydrostatic
pressure feed to the radial and axial
bearing system, meaning that the
inherently variable speed rotor is well
supported under all operating conditions
including gassy, sandy, or viscous fluids.
High Speed and Compact
AssemblyThe turbine design and
bearing support systems enable
operation at super synchronous speeds
(typically 5,000 to 10,000 rpm). These
operating speeds are significantly
greater than those of a comparable
ESP, thus providing a greatly reduced
pump stage bundle length, resulting in a
compact, easily deployed assembly.
Elimination of Traditional Failure
ModesRather than relying on full
isolation of the drive section from the
well fluids through the use of mechanical
seals and protectors, the power fluid
used to drive the turbine provides a
positive, outward clean flush to the pump
end bearing system and is a key lifeenhancing feature. In addition, an HSP
is assembled on a single, high-precision
shaft, eliminating the need for motorpump coupling at the well site.
Advanced Materials of
ConstructionComponents consisting
of high-end materials maximize an HSPs
operational life. Such materials include
super duplex stainless steels, ceramics,
and nickel/cobalt alloys that, over
extended time periods, provide excellent
resistance to erosive and abrasive wear,
corrosion, and sour service.
An HSP provides benefits for
the production of formation fluids,
particularly in challenging applications
such as:
Heavy Oil ApplicationsViscosity
management is a major flow assurance
challenge associated with heavy oils,

30

Power fluid supply

Separator system
Produced fluid
Commingled return fluid

Turbine exhaust
Pump discharge

Control choke valve

Turbine
Pump

Reservoir flow

Fig. 2Hydraulic submersible pump principle of operation. Courtesy of

ClydeUnion Pumps.
more so if there is an emulsion-forming
tendency that could significantly increase
fluid gross viscosity. With an open
loop power fluid supply configuration,
formation fluids with high viscosity
are commingled with the power
fluid to achieve a water-continuous
dispersion downstream of the HSP,
which subsequently reduces associated
frictionlosses.
Multiphase PumpingProducing
oil wells often encounter multiphase
mixtures, either by design or
unintentionally, as free gas is often coproduced. The presence of free gas
at pump suction can adversely affect
the hydraulic performance of pumps,
which are generally designed to handle
incompressible fluids.
Methods of handling gassy fluid
streams have traditionally included

pump suction gas-liquid separators and

variable-speed controllers to minimize
gas ingestion and avoid gas locking and
overheating of the motor.
Recent developments have seen the
incorporation of special helico-axial
or mixed-flow impellers to increase
the maximum gas void fraction before
gas locking occurs. However, despite
these advances, todays extensive use
ofhorizontal wells that can generate
sluggy multiphase flow regimes
continues to threaten the availability
and reliability of downhole motordrivenmachines.
In contrast, in addition to having
helico-axial design multiphase impellers,
an HSPs constant power turbine drive
provides an inherently variable speed
operating capability when it encounters
variable-density fluids within the pump

175

% Design head

150
125
100

HSP Envelope

75

Typical conventional
pump envelope

50
25
0

20

40

60

80

% Design flow

100

120

140

Fig. 3HSP operating envelope. Courtesy of ClydeUnion Pumps.

filters/cyclones, and high-pressure

pumping systems.
Conventional, high-reliabilitypumps
are used at the surface to generate
pressurized drive fluid, and operational
control is effected by a combinationof
variable speed pump drive motorsand
individual well tuning by useofchoke
valves locally at the tree. Typically, a
single-power water pump willbeinstalled
in order to drive up to four HSPs. The use
of readily serviceable, conventional water
processing systems as a motive source
thus provides an opportunity for improved
lift system functionality, availability,
andreliability.

Field Applications
end. For a given power input, the rotor
will speed up and gas compression
efficiency will improve in response to
increased gas void fraction.
In addition, even when faced with
a 100% gas slug event, the interstage
hydrostatic bearings and thrustbalancing arrangement are continuously
fed with power fluid, which increases the
liquids-to-gas ratio through the pump
whilst still supporting the rotor in the
radial and axial direction.
Wax, Scale, and Corrosion
ManagementWellbore chemical
treatments are often required during
production to overcome problems
encountered with waxing, scaling, or
corrosion. In these scenarios, chemicals
must to be injected into the production
fluid path via dedicated flowlines. With
HSP, such inhibitors can be added
through power fluid supply at the
surfacefacility.

Similarly, heated power fluid can

be utilized to artificially increase
the temperature of the commingled
produced fluid to guard against
gelling in fluids with low waxappearancetemperatures.
The functionality of the open loop
HSP power fluid system provides
the capability to circulate out
hydrocarbons from all flow paths
above pump setting depth, thus
mitigating against cold fluid legs that
could cause re-start issues.

System Requirements
The design and arrangement of the
power fluid system is almost as important
as the design of an HSP itselfto ensure
that consistently high-quality drive
fluid is delivered to the machine. An
HSP can make use of many of the water
processing elements commonly found in
oilfield facilities, including separators,

Scott McAllister is a mechanical engineer at SPX,

responsible for engineering design of high-power downhole
and subsea pumping systems within the engineered
solutions team at ClydeUnion Pumps, part of SPX. Since
joining the company in 2008, he has completed engineering
development work, ranging from conceptual design through
to the definition of detailed design scopes. McAllister
attends offshore production and drilling facilities to
supervise the installation of hydraulic submersible pumps. He holds a BEng (Hons.)
degree in product design engineering from the University of Glasgow and the
Glasgow School of Art and an MSc degee in mechanical engineering (design) from
Glasgow Caledonian University.

The simplicity and flexibility of an HSP

has been instrumental in its application
to a broad range of artificial lift duties,
including onshore and offshore
applications, multiphase pumping
of heavy oil, aquifer lift, and seabed
(mudline) boosting, as well as on
thermal production applications, such
as steam-assisted gravity drainage.
In recent times, multiphase HSPs have
been successfully applied to subsea,wet
tree production of gassy, heavy oilin
Chevrons Captain field in the UK
North Sea. The subsea area of this field
hasbeen exclusively produced usingHSP
technology, with the pumps having
achieved an MTTF of over 11 years and a
170-year cumulative operational time.
Field data indicate the successful
operation of an HSP on suction gas void
fractions in excess of 70%, illustrating
the excellent gas handling capability
achieved by the combination of helicoaxial impeller design and turbine drive.
The HSP bearing system provides a
wide operating range which enables the
well to be produced without distressing
the pump. Fig. 3 shows the range of
HSP operating points for a single pump
achieved on a typical well.
For thermal production operations,
the HSP has been designed and qualified
to operate at fluid temperatures of up
to 220C in standard trim. Highertemperature applications can be
accommodated through changes to
sealing element materials. TWA

Vol. 10 // No. 3 // 2014

31

YP Newsflash

Young Professionals
Coordinating Committee Update
The Young Professionals Coordinating
Committee (YPCC) is a 15-member
standing committee that is responsible
for overseeing programs and activities
directed toward SPE young professional
members. Each SPE standing committee
has a chargeconsisting of its
responsibilities and reason for being
that must be approved by SPEs Board of
Directors. There must be a permanent
need for the committees function that
remains the same from year to year.
There are three SPE Board
committees that each oversee a number
of standing committees. The YPCC
reports to the SPE Board of Directors
Committee on Member Programs.
YPCC members are appointed by the
SPE president-elect and serve 1-year
terms renewable up to two times (for a
maximum term of 3 years). Committee
members terms transition at SPEs
Annual Technical Conference and
Exhibition (ATCE).

Merger Between the

YPCC and the Student
Development Committee
An SPE Board Finance and Strategy
Committee task force was formed in
2013 to review opportunities for SPE
to streamline its overall governance
structure. The task force recommended
a merger between the Student
Development Committee (SDC) and the
YPCC, which was approved by the SPE
Board at its July 2014 meeting.
The combined committee would help
SPE gain a cohesive view of its growing
population of young professional
members and student members. The
combined committees perspective
could help SPE student members
transition into the working world. The
charter for the combined committee and
its structure are being finalized, and the
new committee will take effect starting at
ATCE 2014.

Ambassador Lecturer Program

The YPCC and SDC are working
together to reenergize the Ambassador

32

SPE Bahrain Section YPs with students at Naseem International School.

Lecturer Program (ALP), with the aim of

increasing the number of Ambassador
Lecturers and of improving reporting
back to SPE after lectures are presented.
The reenergizing program will
initially focus on the Northern Asia
Pacific Region and the South, Central.
and East Europe Region. If you are
interested in volunteering as an
Ambassador Lecturer, please contact
us by email: alp@[Link]. The YPCC is
also creating an online version of ALP
assistance for new SPE student chapters
and for new Ambassador Lecturers
preparing to make an ALP visit. The
video should be available in the SPE
online video library later in 2014.

YP Workshop @ ATCE 2014

The YPCC organized a YP workshop
that will take place during ATCE 2014.
The theme for this years workshop is
Expanding Opportunities for YPs in
Industry: Thinking Outside Technical
and Managerial Roles. This workshop
provides opportunities for young
professionals to learn about emerging oil
and gas industry career opportunities
that require a mix of technical and
managerial skillsets. The workshops
panel discussion speakers have diverse
backgroundsas entrepreneurs,

researchers, leaders of new business

development groups, asset managers,
and career counselors. For more
information, visit the ATCE 2014 website:
[Link]/atce/2014/.

YP Network on SPE Connect

The new YP Network is being utilized
as a fantastic tool for networking and
knowledge sharing. Log on to connect.
[Link] and see how the YP Network can
benefit you in your role, your career, and
even your everyday life. Its a great way
to meet peers from all over the world
and share ideas that will continue to
stimulate industry involvement.

SPE Bahrain Section YPs

Launch Their SPE energy4me
Program Outreach
As part of its initiative to educate
students about the petroleum
engineering profession and industry
issues, the SPE Bahrain Sections young
professionals launched a program using
SPE energy4me materials so they could
share the facts about energy with the
public and put a face on the industry.
For the program, they chose the slogan
Together, we can make a difference.
The program was kicked off at
Naseem International School on 25

After the talk, a barbecue lunch

was held, organized under the
sponsorship of Petoil Petroleum. This
was the first integration meeting
in 2014. The SPE Turkey Section
traditionallyorganizessuch meetings
twice a year.

SPE Mumbai Diaries

Mumbai Section young professionals enjoying a field trip to a Mumbai beach to

understand fluid flow behavior.

February 2014, which provided the SPE

Bahrain Sections YP committee with
the opportunity to expand the students
personal, intellectual, and professional
horizons by teaching them about the
oil and gas industry, its strategic role in
Bahrains economy, its development, and
the valuable role the students could play
within it.
Students listened as several YP
members shared what a typical
day is like in their office. The
youngprofessional SPE members
hope this might inspire the students to
enroll in petroleum-related disciplines,
suchas petroleum engineering,
geology, andexploration, because
it seems a good future awaits those
who graduatewith petroleum-related
degrees in Bahrain and around
theworld.

Tahani Hussain
Environmental Specialist,
Tatweer Petroleum Officer, SPE
Bahrain Section Board

Section in Focus: Turkey

The SPE Turkey Section supports four
SPE student chaptersthe Middle East
Technical University (METU) Chapter;
Middle East Technical University
Cyprus Chapter; Istanbul Technical

University (ITU) Chapter; and Batman

University Chapterand works to
connect each chapter and its instructors
with each of the other three chapters and
their instructors.
One of the most exciting seminars
took place at the METU Petroleum
and Natural Gas Engineering
(PNGE) Department auditorium on
25 March 2014 in Ankara. The title
of the discussion was Thoughts on
Petroleum Engineering Education and
IndustryUniversity Collaboration.
Mustafa Onur, a professor at ITU who
has developed and taught courses at
both the undergraduate and graduate
levels at four universitiesUniversity
of Tulsa, ITU, Universiti Teknologi
Petronas, and King Saud University
was thepresenter.
The discussion drew about 100
attendees, including 10 instructors
from PNGE departments, high-level
executives, and students from the METU
and ITU student chapters. Onur finished
his talk by focusing on petroleum and
natural gas engineerings bright future
throughout the world and the invaluable
contributions SPE makes to the
petroleum and natural gas engineering
profession. This event was organized
and coordinated by SPE Turkey Section
young professionals.

The SPE Mumbai Section has been

buzzing with activity this year,
thereby helping reinforce Mumbais
role as the heart of Indias oil and
gas industry. The section included
a wide variety of activities during
its year, including presentations by
SPE Distinguished Lecturers, several
technical programsand study group
meetings, and Ambassador Lecturer
Programefforts.
The year kicked off with a special
emphasis on SPE membership
renewal and recruitment. Seminars
encouragedcompanies to sponsor
professional employees for SPE
membership and taught about the
efficient use of social media and
sectionnetworks. The section also
donated Braille education kits to the
National Association for the Blind,
Mumbai, for use by visually impaired
children. The kits included a brief
article, written in Braille script, about the
oil and gas industry and its contribution
to daily life.
The section, with the support of
SPE International, established an SPE
student chapter at the Indian Institute of
Technology, Bombay, whose purpose
is to open avenues for more students to
benefit from SPE activities.
The year was equally successfulfor
the YPs themselves, who not only
participated in ALPs across India
but also, along with regular SPE
activities, volunteered at local
schools. A notableYP activity was
going on a geological field trip to
a Mumbai beachto understand
fluid flow [Link] field trip
ended the Mumbai Sectionsyear
on a highnote with the promise
of an evenmoreenthusiastic year
[Link]

Vol. 10 // No. 3 // 2014

33

THE YOUNG PR

OFESSIONALS

GUIDE TO

The
Hague,
Netherlands
Shruti Jahagirdar, Shell Technology India; Harshad Dixit, Halliburton;
Jim Stiernberg, Chevron; and Kristen Weyand, ConocoPhillips

While Amsterdam is constitutionally the

capital of the Netherlands, The Hague is
its administrative capitalthe seat of its
government and location of its parliament,
the capital city of the province of South
Holland, and the city where Hollands
King Willem-Alexander and Queen
Mxima reside. Located in southwestern
Holland on a coastal plain, with its center
just inland from the North Sea, Den Haag
or s-Gravenhage (i.e., the counts haghe
or hedge) has several phrases it is
known by: the Royal City by the Sea,
the Residence City where the Dutch
nobility resides, and the International
City of Peace and Justice where more
than 160 international institutions and
organizations dedicated to the cause of
world peace are housed.
The city is grand and stately, filled
with gardens and parks, renowned
museums such as the Mauritshuis and
the Gemeentemuseum art museums, and
many architectural wonders including
embassies and royal residences along
the beautiful North Sea coastline.
Although the Dutch weather can be
harsh at timesfrequently cold and very
windythose who live there enjoy the
caf culture and gastronomic delights
offered by the citys numerous eateries.

34

Fit and Active Citizens

Scheveningen, the best-known seaside
resort on the Dutch coast, is one of The
Hagues eight districts. On summer days,
people are often seen kite surfing and
bungee jumping around the lighthouse at
Scheveningen; and during the cold winter
months, people love to go ice skating on
the 550-m2 rink set up in the square in
front of the Kurhaus.
The active Dutch lifestyle is very
much reflected in The Hague, with
most people riding bicycles to work
and running to keep fit in all types of
weather. The Dutch attitude towards
fitness garners a lot of praise and respect
from foreigners and expatriates living in
thecity.

A Center for Peace,

Hope, and Diplomacy
For many people and corporations,
The Hague represents a beacon of
hope, another chance at justice. The
Peace Palace in the center of The
International Zone houses the keepers
of international justiceamong many
other organizations, these include
the International Court of Justice and
Permanent Court of Arbitration. Even
though it actually is the fourth-largest

United Nations location, the Hague

has been called the United Nations
secondcity.
During the 13th century, the city
was just a hamlet built around a counts
castle. In the 17th century, when the
Dutch Republic played a leading role in
Europe, The Hague became a center
for diplomatic negotiation. The royal
residence was based here, leading to
the establishment of embassies in The
Hague, sparking its metamorphosis
into an international city. The 20th
century saw The Hague coming of age
as an international city of peace and
justice, with numerous conferences and
arbitrations taking place there.

The Hague: An Important

Oil and Gas Hub
A large number of oil and gas,
international engineering, and
consultancy firms have bases in the
region around The Hague. Several
international corporations have corporate
headquarters in The Hagueamong
them Holland-based Royal Dutch Shell;
energy infrastructure company Chicago
Bridge & Iron; Aramco Overseas, a
subsidiary of Saudi Aramco; APM
Terminals, a separate business of

YP Guide
Moller-Maersk Group; and Total E&P
Nederland, Totals Netherlands operation.
In addition, one of Schlumbergers four
principal offices is in The Hague. The
presence of the national government and
its role in issuing oil and gas licenses (in
the Dutch North Sea Shelf) makes The
Hague an ideal location for oil companies
administrative offices. More than 10,000
people work within the oil and gas sector
in The Hague region.
Currently, the Delft University of
Technology is the only university that
offers an SPE-recognized petroleum
engineering degree in the Netherlands,
although several other Netherlands
universities offer courses related to the
petroleum industry. Delft University is
also home to the first Netherlands-based
SPE student chapter, established in
1984. The industrys growing need for
young talent has been reflected in the
creation of two additional Netherlandsbased SPE student chapters in the past
10 years: Utrecht University, established
in 2009; and Vrije University Amsterdam,
established in 2010.
The Netherlands is not a significant
producer of liquid fuels, but it is an
important European liquid fuels
transportation and processing hub,
according to the US Energy Information
Administration (EIA). In addition, it is a
major petroleum liquids refining and
storage center. After Norway, the EIA
states, it is the second-largest producer
and exporter of natural gas in Europe.
At the start of 2014, Oil & Gas Journal
estimated the Netherlands proved
reserves at 302.5 million bbl of oil and
39.9 Tcf of natural gas, well behind the
other North Sea mainstaysthe United
Kingdom, Norway, and Denmark.
However, activity in the Netherlands is
high. Proved oil reserves have tripled
between 2010 (100 million bbl) and 2014
(302.5 million bbl), according to the EIA,
reaching a level not seen since 1985.
According to the Netherlands Oil
and Gas Portal ([Link]), in 2012,
the Netherlands saw 2.6 Tcf of gas and
8.1 million bbl of oil production from
over 250 developed gas fields and 15
producing oil accumulations. Gas is the
most significant hydrocarbon fuel for the

Netherlands, and most of it comes from

the largest onshore natural gas field in
western Europe, Groningen, which was
discovered in 1959, with first production
in 1963. It is located in northern
Netherlands. The remaining gas fields in
the country are considered small fields
in comparison to this giant.
The government has capped
Groningens productionwhich is the
source of approximately 75% of the
countrys natural gas outputat 1.5 Tcf
per year from 2006 through 2015 as
part of a policy to stem reserve declines
and encourage production from smaller
fields. ([Link]).
The largest onshore oil field in
western Europe, Schoonebeek, is also
located in the Netherlands, extending
partially into Germany. Discovered in
1943 while Holland was under German
occupation, Schoonebeek has seen a
recent revitalization after being shuttered
in 1996 due to high operating costs and
low oil prices. With rising commodity
prices and new seismic processes
reducing risk of geological uncertainty,
measures were taken beginning in 2009
to bring the field back on production. An
aggressive drilling program of 73 wells,
including 25 steam-injection wells and
a revitalized infrastructure, paved the
way for production to resume in January
2012. Nederlandse Aardolie Maatschappij
(NAM) anticipates that it will produce 120
million bbl from this oil field in the next
25 years, according to EBNs 2013 Annual
Report. EBN is an independent company
with the Dutch state as the sole sharholder.
Faced with declining gas reserves
(reserves peaked at just over 70 Tcf in
1987), companies in the Netherlands
maintain a focused effort on improving
ultimate recovery from existing
resources. Operators are extending
existing field life by utilizing methods
such as velocity strings, foam injection, jet
pumps, tail pipe extension, compression,
and plunger lift. EBN notes in the annual
report that the implementation of such
methods has increased the countrys
recoverable reserves by about 2 Bcm of
gas (71 Bcf) in the past 10 years.
Not limited to simply improving
production from existing fields, the

development of recent discoveries looms

on the horizon. In 2012, six successful
exploration wells added a total of 3.5 Bcm
(12.4 Bcf) to Dutch resources. According
to Wintershall, these were successfully
drilled the F17-10 chalk oil-well in late
2012, making it the most recent Dutch
offshore discovery. With two appraisal
and three wildcat wells planned for
this year, Wintershall estimates the oil
accumulation to be 30 MM bbl of oil
([Link]).
Key challenges to the industry
include public perception that natural
gas reserves are declining. Andnot
to be exempt from the nearly universal
issuethe industry faces opposition
from the ongoing shale gas debate and
anti-hydraulic fracturing proponents.
However, with the long history of
successful production in this country,
combined with innovative methods
of extending field life and new field
development looming on the horizon, the
Netherlands continues to be positioned
for a healthy contribution to hydrocarbon
production in Europe.
While tourists are drawn to The
Hague for its history, architectural
wonders, and vibrant spirit, the oil
and gas industry embraces this
multifaceted city as an important center
for the petroleum sector. This year,
SPE members have another reason to
gravitate to the Royal City by the Sea
The Hague is only an hour away from
the site of SPEs 2014 Annual Technical
Conference & Exhibition in Amsterdam.

YPGT: A Glance Back

and a Glance Ahead
The section youre reading, called the
Young Professionals Guide to..
(YPGT) the cities of the world, has
flourished as a consistently favorite
section for The Way Aheads readers
because of its ability to connect with its
audience in various parts of the world.
It captures the truly global spirit of the
oil and gas industry where overseas
travel is frequent. YPGT celebrates the
international nature of the petroleum
industry by investigating the global
oil and gas hubs and metropolitan
cities along with sharing top stories of

Vol. 10 // No. 3 // 2014

35

If knowledge
is power,
get ready
to be
supercharged.

Discover more at
[Link].

YP Guide
the developments and technological
advancements in our business.
The YPs Guide to. section
debuted in the 2009 Vol. 5 No. 2 issue,
with an article focused on Aberdeen,
Scotland. YPGTs tone is friendly yet
informative for the traveling reader. To
this end, the article typically covered
major sightseeing landmarks, local
customs to observe, educational
institutions that power growth in this
industry, the largest companies in the
area, and the political climate regarding
the oil and gas business. Designed
to help professionals when they did
business around the world, YPGT was a
cross between a tour guide and a brief
essay about oil-and-gas-related activity..
Scoping an article with such ambition
was not easy. We could not travel to every
location to report firsthand experiences,
and many times we could not obtain input
from someone with intimate knowledge
of the technical breakthroughs and
discoveries occurring in that part of the
world. In hindsight, the more interesting
pieces were probably those covering
areas that seldom had major media
exposure yet played an integral role in
commodity trading and, in many cases,
the economy of a state.
Improvements in technology were
often included in the discussions, as
they are the main driver for recovering
dwindling reserves and the impetus for
further investment in these petroleum
centers. We also often briefly sketched
regional geological trends, the reserves
figures, and production to date. A sidebar
listing some interesting facts about the
city often left our readers amazed and
wondering what the city would really
be like. It has been a truly a memorable
decade, during which we covered more
than 11 places prominent in the oil and
gasindustry: Sakhalin Island; Calgary,
Alberta; Perth, Western Australia; Port
Harcourt, Nigeria; Dubai, UAE; Houston,
Texas; Jakarta, Indonesia; San Francisco,
California; Rio de Janeiro, Brazil; Abu
Dhabi, UAE; Mexico City, Mexico.
While our team remembers the
days of putting together those lively
articles, we are also looking forward to
further experimentation with different

approaches. Our article in Vol. 10 No.1

A YPs Guide to Continental Savvy:
Energy Entrepreneurship Across
Three Continents, was one such
experiment: Instead of focusing on one
city, we covered three continents, each
with different examplesof energyrelatedentrepreneurship.
The response to the Continental
Savvy article was so positive that in
the following issuewith its overall
theme Job Security in the Oil and
Gas Industrywe once again took
you around the world. But this time we
focused on those countries where job
opportunities were created or affected by
technology advancement, geopolitics, or
market expansion, all of which demanded
that we tap into the insights of experts
we knew. We stressed the impact these
phenomena had on oil and gas industry
development and quality of life in the
highlighted countries.
Our aim is to keep bringing you
multidimensional stories from our
industry across the world, enabling
trendcomparisons among specific
[Link] forward, it will be
interesting to compare energy industry
trends specific to geographical
locations, cultures, areas of industrial
growth, political stability issues, and
the availability of local talent. This
will be in addition to travel tips and
historic facts about the cities. We hope
to provide our readers with a wider
perspective regarding the actions and
decisions of popular energy hubs
makers and breakers. Additionally,
we would like to extend the scope of
our articles, where appropriate, on
safety and environmental issues faced
by some countries and the impact they
have on the oil andgasindustry and
governmentrelations.
Of utmost importance, the section
seeks to stay up to date about the
industrys most recent developments. We
will continue to expand our horizons to
bring you interesting stories emerging
from the oil-dominant provinces and their
business models. The YPGT section is
ready to be your guide as you explore
the oil and gas industry across cities,
countries, and continents. TWA

Academia

The Way Ahead for US

Unconventional Reservoirs
Erdal Ozkan, Colorado School of Mines

400
Drilling &
completion
technologies provide
the early return of
the investment

No new
breakthrough
recently

350
Annual Production/Well, q
(M bbl/y)

The emergence of unconventional

resources as a viable source of
energy in the US is the combined
result of persistent exploration
efforts and development of
new drilling, completions, and
stimulationtechnologies.
However, it is estimated that nearly
90% of tight oil and 65% of shale gas
will be left in the reservoir using
current methods of production (US
Energy Information Administration,
2013). For the US to move steadily
towards meeting all its energy needs
from domestic resources by 2035
(Bloomberg, 2013), proper management
of its unconventional resources to
achieve long-term sustained production
and improved recovery is of significant
interest to all stakeholders. While
exploration, well construction, and
stimulation will continue to be critical
for unconventional resource recovery
economics, sustained productivity and
effective depletion are expected to be

300
250

Reservior technologoes ensure

the long-term sustained production
Need genuinely
unconventional concepts

200
150
100
50

Bakken Horizontal Well

(10,000 ft & 30 Frac Stages)
Average US vertical well

0
2011 2016 2021 2026 2031 2036 2041 2046 2051
Year

Fig. 1Production decline trends for vertical wells in conventional plays and
horizontal wells in unconventional plays.

growing challenges in the way ahead for

unconventional reservoirs.

Why Unconventional
Reservoirs Are Different
Wells in tight unconventional plays
enjoy a high initial production (IP)

Erdal Ozkan began his professorial career at Istanbul

Technical University in 1989. After serving as a research
associate at TU during 199798, he joined the Colorado
School of Mines in 1998 where he now is the director of the
Unconventional Reservoir Engineering Project and codirector of the Marathon Center of Excellence for Reservoir
Studies. The author or coauthor of three books and over 100
technical papers, his technical expertise includes reservoir
engineering, modeling unsteady flows in porous media, pressure-transient analysis,
horizontal and multilateral well technology, and unconventional oil and gas
reservoirs. Ozkan received SPE Distinguished Membership in 2009; the SPE
Formation Evaluation Award in 2007; SPEs A Peer Apart Award in 2007; and
Distinguished Technical Editor Awards in 1998, 2006, and 2013, In addition, he
received the distinguished alumni award from the University of Tulsa in 2007. He
has been executive editor, associate editor, and editorial board member of several
leading petroleum engineering journals. Ozkan has served as chair or cochair of
several SPE conference and workshop committees; technical director of the SPE
R&D Technical Section; and as an SPE Distinguished Lecturer during 201112.

rate accompanied by a high decline

rate (Fig. 1). After the first 2 to 3
years, production decline slows to
alinear trend. Well construction
andcompletionaspectssuch
as welllength, hydraulic fracture
properties, and the contribution
of intercepted natural fractures
control the initial high-productionrate period. During the following
period, when a lower production rate
becomes the norm and production
decline slows, reservoir flow and
transport mechanisms dominate the
wellresponse.
While the initial production period
is important for favorable economics,
the long-term production period is
important for effective depletion of
the reserves. Because of economic
incentives, the industry has focused
mainly on technologies that obtain
higher IPs. As the perception emerges
of unconventional reserves as longterm resources, the need to understand
long-term reservoir flow characteristics
becomes more appreciated.

Vol. 10 // No. 3 // 2014

37

Academia
Knudsen Number: Kn=
No-Slip
Conditions

Mean Free Path of Fluid Molecules

Macroscopic-Average Pore-Diameter

Slip
Conditions

Continuum
Flow

Slip
Flow

Kn

10-3

10-2

Non-Darcy Darcy
Flow
Flow
Macro-scale pores
Fast-Evolving Processes

Transitional
Flow

10-1

100

Free-Molecular
Flow

101

Kn

Non-Darcy
Flow
Nano-scale pores
Slow-Evolving Processes

Fig. 2Knudsen (1909) flow regimes relative to macro- and nano-scale

poresystems.

4000
No confinement
Confined (2 nm)
Confined (4 nm)

Pressure (psia)

3000

Confined (5 nm)

2000

1000

0
-150

-100

-50

50

100

150

200

250

300

Temperature (deg F)

Fig. 3Phase diagrams of confined and unconfined gas-condensate mixture

(Sapmanee, 2011; Devegowda et al., 2012).

Flow and Phase Behavior in

Nano-Porous Reservoirs
Nano-porous unconventional reservoirs
possess multiple flow mechanisms at
different scales.
Advection is the fastest such
mechanism; however, its contribution
to total flow is the least due to the small

38

proportion of the pores and natural

fractures in which Darcy flow occurs.
In matrix nano-pores, much slower
diffusive processes occur. These are
often attributed to molecular dynamics,
concentration gradient, and osmotic
pressure caused by pore proximity
and heterogeneity. For example, recent

research (Javadpour et al., 2007; Ozkan

et al., 2010; and Akkutlu and Fathi, 2012)
has established that, at the dominant
pore sizes of gas shales, the Knudsen
number becomes large enough for
slip flow to prevail at low pressures
(Fig. 2). In addition to slip flow, Darcy
flow in macro pores and fractures and
desorption in the pores of the organic
material are potential contributors to gas
flow in shales.
Slip flow is not likely to play a role in
liquid flow in tight formations. In these
plays, concentration-driven diffusion
comes into effect due to pore-sizedependent bubble-point suppression or
dew-point enhancement. Bubble-point
suppression is a result of increased
capillary pressure and surface forces
acting on the liquid and gas phases as
the pore size decreases (Firincioglu et
al., 2012; Honarpour, 2012; Sapmanee,
2011; and Devegowda et al., 2012). As
a result, phase behavior becomes a
function of pore size when pore size
drops to nanometers (Fig. 3). Having
different liquid pressures at bubble
point as a function of pore size creates
concentration-driven diffusion in nanoporous unconventional formations.
However, because some pore-throat
sizes are at the scale of membrane
pores, they do not permit the passage
of heavier hydrocarbons with large
molecules. This sieving effect may cause
osmosis-like behavior, which may act
counter-currently to concentrationdriven diffusion in heterogeneous nanoporous systems.

Flow Modeling in
Unconventional Reservoirs
Current practice amongst many
practitioners is to use conventional
flow models with minor adjustments.
When the flow mechanism and phase
behavior deviate considerably from
conventional flow perceptions, the
conventional models predictive
capability becomes moot.
Current attempts to alleviate
modeling problems fall into two
categories. The first is motivated
toward responding to the industrys
immediate needs and focuses on

Long Life, TWA!

tweaking existing conventional models
to imitate observed field performance.
In the absence of a comprehensive,
coherent, and consistent physical
framework, these models can provide
a trend line for short-term field
performance, but they have limited
capabilities to predict longer-term
behaviors and guide interventions to
improve field performance.
The second aims to fundamentally
overhaul perceptions of flow in nanoporous unconventional reservoirs.
These efforts focus on the description
and coupling of multiple flow
mechanisms acting under differing
molecular dynamics and continuum
conditions. Combined with the
heterogeneity of the flow domain,
the existence of concurrent flow
mechanisms leads to a heterogeneous
velocity field, which may be handled
outside conventional diffusion (i.e.,
Darcy flow and Fickian diffusion)
models (Raghavan and Chen, 2011).
These efforts require more time than
those in the first category to mature and
develop tools for practicing engineers
and scientists.

Performance and EUR Prediction

in Unconventional Reservoirs
The common practice of developing
unconventional reservoirs with long,
multistage-fractured horizontal wells
results in elongated infinite-acting
flow periods. In the absence of data
indicating the boundedness of the
drainage area, techniques to estimate
economic ultimate recovery (EUR)
require external data or subjective
assumptions. The application of
decline-curve analysis ideas to predict
future production and estimate EUR
in unconventional reservoirs (Lee
and Sidle, 2010) thus often lacks a
boundary reference.

Another complication is the long

linear flow (sometimes lasting decades)
dominating the infinite-acting behavior
of hydraulically fractured horizontal
wells. With linear flow, the diagnostics
required for independent estimation of
the parameters of interest do not reveal
enough to be of real use, because
only the product of the permeability
and fracture half-length can be
obtained. This problem has important
repercussions for well spacing.
In shale-gas plays, the drainage
area of the well is assumed to be
limited to the stimulated reservoir
volume (SRV). If the permeability of
the SRV is predicted to be low, then
the fracture half-length, and thus the
drainage area of the well, will be
estimated as being large; the opposite
is also the case. Usually, microseismic
data and numerical simulation are used
to complement linear-flow analysis
to fine-tune SRV volume. However,
without true boundary-dominated flow,
estimation of the drainage area always
includes some order of uncertainty.

Looking Toward the Future

The unconventional reservoir
revolution has led to the secondbiggest oil boom in the USthe largest
having started in 1859 with the US oil
discovery in Pennsylvania. Perhaps
more important than the volumes
of oil and gas produced today from
US unconventional reservoirs is the
confidence the industry has gained
from accomplishing production from
shale, once seen as oil reservoirs
impermeable seal.
In the years ahead as the industry
continues to need unconventional
reservoir technical and operational
advancements, those now beginning
their oil and gas careers will have
major contributions to make. TWA

When SPEs TWA

magazine came to life
10 years ago, most
SPE members were
unaware it was the
end result of several
years of preparatory
work carried out by an international
dynamic team of talented, passionate,
and inspired young professionals. In
line with SPEs vision and mission,
their ambition was to grant novel
opportunities to accelerate learning and
to boost young professionals personal
and professionalgrowth.
From that visionary teams point of
view, the availability of a global strategic
communication channel such as TWA
providing visibility, sense of identity,
open space for discussion, and extended
learning opportunitiesappeared a
truly compelling choice. That sense of
urgency was readily conveyed to and
perceived by the SPE staff and board.
As mentors, we ensured trust, autonomy,
and continued supportsoliciting in
exchange only excellence.
Over these 10 years, TWA has
inspired the development of many young
professional programs around the world.
More than 110 young SPE professional
members served on the editorial
committee, wrote articles, interviewed
top executives, sent comments and
suggestions, provided news and photos
of their local events and achievements;
and many thousands of readers have
benefited from the wisdom each story in
each issue had to sharefrom industry
leaders, top scientists, economists, and
seasoned or young professionals.
Today, with enormous pride and
satisfaction, we notice copies of TWA
on so many young professionals desks
all over the world, confirming that the
original idea was right and timely.
Congratulations on your anniversary:
May you ever suffuse TWA with fresh
energy, creativity, effort, and inspiration!

Giovanni Paccaloni
2005 President
Society of Petroleum Engineers

Vol. 10 // No. 3 // 2014

39

Your Best Shot

Apply Today
to Join

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Team
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Personal Way Ahead
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Coiled Tubing Rig Up, Kapuni Field, Taranaki, New Zealand

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Shell Todd Oil Services
Photo taken of a coiled tubing rig-up operation, using a 12.1-megapixel
CanonIXUS 115HS.

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Photo by Elizabeth Reale, Petroleum Engineering Student,
Colorado School of Mines
This photo depicts the inside of a wooden derrick displayed at the West Kern
OilMuseum Inc. Photo was taken with an 8-megapixel iPhone 4s (f/2.4).

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