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NEW RESEARCH: RENEWABLE ENERGY SOURCES AND ANTARCTIC AND AUSTRALASIAN EXPLORATION AND PRODUCTION WILL BE THE FUTURE

Renewables will overtake oil, gas and coal as the world’s prevailing energy source, whilst Antarctica and Australasia have been highlighted as global E&P hotspots, according to new survey research.

The Maxwell Drummond International Energy Survey 2011, led by global retained executive search consultancy Maxwell Drummond, is based on responses from business leaders within major oil and gas operators and contractors in the Europe, USA, Canada, Asia, Africa, Australasia and the Middle East. The interviewees represented a significant section of the oil and gas industry.

Kevin Davidson, CEO of Maxwell Drummond International, said: “This was a short, sharp, swift piece of qualitative research to gain a deep insight into the industry from the perspective of its global leaders. We explored a wide spectrum of issues from the evolving energy mix to recession impacts, from financial and operational strategies, to people management and skill development.

“The results were illuminating on many different levels, but one discovery particularly interested us. In contrast to last year’s survey, alternative energy is now at the forefront of energy business leaders’ minds as an increasingly valuable source. In 2010, oil or gas was expected to be the most substantial contributor to the energy mix in the next five, ten and 15 years. But in 2011, more than 90% of respondents believed that by 2025, renewables will be the most substantial energy source.

“The industry’s current resource gaps were highlighted, particularly in reservoir/petroleum engineering (45%), drilling/completions (45%), field operations (41.4%) and subsea/marine (39.6%). The oil and gas sector’s poor public perception was considered responsible for the gaps (63.8%). Respondents said collaboration and knowledge sharing would improve the situation. To facilitate this, they favoured cross-sector task forces (58.6%) and employee exchanges (46.8%). Project management and engineering (69.4%), HSE (49.5%), offshore operations (47.7%) and onshore operations (40.5%) were cited as the areas expected to benefit most from sharing functional practice.

“Respondents expect demand for oil and gas from emerging economies to dominate industry debate in 2011 (90.3%). The perception of Latin America as a global exploration and production hub in the next ten years increased from 38% in 2010 to 79% in 2011. There were some other, more surprising, geographical predictions too: 70.2% of respondents in 2011 forsee Australasia an E&P-focused area in the next ten years, compared to only 22% in 2010. This year, 80% believe Antarctica will be a key region by 2025.”

Key findings:

• 57.6% believe hiring new personnel with the specific skill sets they lack will be the best way to capitalise on the evolving energy mix.

• Expectation of North America and Europe as global energy centres has decreased between 2010 (63%) and 2011 (57.5%).

• China (24% in 2010 and 36% in 2011) has overtaken Eastern Europe (30% in 2010 and 26.3% in 2011) as the next main focus for unconventional resources.

• Focuses of energy industry debate include security of supply (61.1%) and environmental issues (42.2%), although ecological concerns have decreased in prominence in the past year (50% in 2010). Importance of staff training slipped from 54% in 2010 to 35.4% in 2011.

• 98.2% would encourage students and graduates to consider a career in energy.

• 63.1% cited the ability to attract and retain the right people is the main barrier to accessing experienced staff. 50.5% said a lack of knowledge transfer is also a barrier.

• 22.9% believe there is a lack of willingness/ability to recruit/train from other sectors.

Sean Buchan, Maxwell Drummond UK general manager, commenting on the report’s conclusions, said: “This research offers a fascinating insight into the oil and gas industry from the point of view of those immersed in it. Links between the questions are fascinating. Statistics regarding resource gaps push industry collaboration up the boardroom agenda. This is supported by the overwhelming interest in renewables as an energy source: to capitalise on this potential development, sectoral skill sharing is essential.

“At Maxwell Drummond, we have witnessed this person by person. Over the past six months, there has been a renewed commitment from oil giants building and acquiring teams with renewable expertise. Executives are finding their expertise has a new currency. In addition, the number of business leaders encouraging students and recent graduates to consider a career in energy has increased between 2010 and 2011, emphasising the need for fresh skills.

“Industry debate is defined by segregated thinking of oil or coal or nuclear or renewables. Yet there is a natural synergy between energy industry disciplines. Sectors must begin to share knowledge and experience, technology, business models, operations and maintenance practices to benefit the industry, individual companies and employees.

“The statistics urging industry collaboration offer the industry a way to rise above the problems caused by budget announcements and regain its innate optimism. We undoubtedly have a unique opportunity to mature our industry, to make it safer, more efficient and more sustainable.”

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