Australian oil explorers hampered by labour shortage
Thanks to DanielXXX for highlighting this article. although its a bit old, it is relavant.
Australian oil explorers hampered by labour shortageGOLD COAST, Australia, May 9 (Reuters) – Oil and gas explorers in Australia’s waters could be forced to scale down their activities due to a global shortage of skilled labour and equipment, an industry conference was told on Tuesday.”The rate of exploration, notably for gas, is increasing such that old ideas about moving the workforce around will not meet the scale of need,” Petra Nelson, chief executive of employment consultants Gerard Daniels told the meeting in Queensland.
A new report from The Australian Petroleum Production and Exploration Association focused on the cost pressures and labour shortages being experienced by oil and gas majors and smaller local explorers.
It also highlighted declining oil production, saying Australia had only 17 years of remaining oil reserves against 117 years of gas, and that scarce workers were being channeled to gas projects considered easier to commercialise.
Royal Dutch Shell’s head of Asia-Pacific exploration, Wouter Hoogeveen said the industry faced losing half of its existing workforce to retirement within 10 years, with the average age of workers now standing at more than 45 years old.
“Human resources are a clear challenge,” Hoogeveen told Reuters on the conference sidelines.
“Costs for explorers are rising very steeply. There’s a hot market for rigs and seismic (testing) too, which could place constraints on what the industry can do.”
On Monday, Exxon Mobil Corp. said it would delay a final investment decision on its Gorgon liquefied natural gas joint-venture project until 2007 amid rumours that a shortage of manpower and equipment was causing a cost blow-out.
SMALLER COMPANIES HIT
Bruce Phillips, managing director of new producer Australian Worldwide Exploration told Reuters that burgeoning costs were a particular stress to smaller companies like his own.
“It’s hard to get a rig, and when you do the cost has blown out over the past year,” he said. “Available skilled labour is quickly snapped up so there’s terrible tightness there too.”
Western Australia has said it needs 20,000 new workers — 1 percent of the population in a state that already employs 10 percent in resources — to meet the needs of known projects alone. National estimates start at more than 30,000 workers.
The country’s flagship North West Shelf liquefied natural gas joint venture was criticised last year for hiring an Indonesian firm to manage construction of its fifth processing train, with joint venturers saying local staff were simply not available.
But Shell’s Hoogeveen said the company’s decision to increase 2006 drilling activity in Australian waters by fivefold on the previous year was in part motivated by the relative ease of convincing internal staff to make a transfer. “One of the secondary reasons for our focus on Australia is that it’s a little bit easier to attract internal people to work in Perth than some other parts of the oil exploration world.” ($1=A$1.30)
Related posts:
- AusGroup’s interview with Dow Jones
- Singapore Petroleum Co (SPC)
- The most interesting paragraphs out of the report.
- Matthew Simmon’s Excellent Presentation on the future shortage of oil and water
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