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Thread: Oil and Gas - The Great Crew Change - thoughts?

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    Default Oil and Gas - The Great Crew Change - thoughts?

    This has been a favourite topic of mine for more than a decade now. What are your thoughts on the future demographic and employment trends of the petroleum industry?

    I used to be of the unlimited growth mindset. These days, I feel like total employment is bound to shrink in the USA just like it has in Canada and not rebound to previous peaks in either place. However, opportunities for people in the 30-45 age bracket today will be huge.
    SPE discussion on the topic:
    https://pubs.spe.org/en/twa/twa-arti...tail/?art=6444
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    You realize you are talking to the guy who made his own furniture out of salad bowls right?

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    Employment will definitely shrink. Every year we get better and better at putting holes in the ground and getting resources out. Even if overall production rises, we don't need the man-power we once did, it's just not needed.

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    It's my opinion that the USA should be running 450-500 rigs total to be profitable. Any higher is problematic.
    But I've proven repeatedly to be bad at predictions.

    As for the great crew change, I wish everyone over 65 would retire today. I don't feel like that's terribly radical, but it would have a huge effect as those top level roles were backfilled.
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    You realize you are talking to the guy who made his own furniture out of salad bowls right?

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    Quote Originally Posted by pheoxs View Post
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    Employment will definitely shrink. Every year we get better and better at putting holes in the ground and getting resources out. Even if overall production rises, we don't need the man-power we once did, it's just not needed.
    We get better at all levels of the industry. Yet a ton of shops are still stuck in the past pissing away thousands or millions of dollars because they are unwilling to change. Its crazy.

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    My prediction is that at some point in the next 5 years, there is going to be a huge shortgae in terms of properly trained and experienced upper management. The transition from Jr -> Sr -> Exec hasn't been rolling along as I had expected or been told.

    I think back when I graduated high school I was hearing about how when the Boomers retire there was going to be a massive labour shortage. I think that same headline makes news today.
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    Quote Originally Posted by msommers View Post
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    My prediction is that at some point in the next 5 years, there is going to be a huge shortgae in terms of properly trained and experienced upper management. The transition from Jr -> Sr -> Exec hasn't been rolling along as I had expected or been told.

    I think back when I graduated high school I was hearing about how when the Boomers retire there was going to be a massive labour shortage. I think that same headline makes news today.


    You think there's properly trained and experience people in upper management now.


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    The senior guys can't afford to retire because they haven't been saving enough/have greatly inflated their lifestyles so they are holding onto their jobs longer. Juniors aren't being hired to fill the lower ranks, so it's the intermediates doing all that stuff. For the intermediates, there's no upwards mobility or any training, so it's just going through day by day and maybe occasionally jumping ship to spice things up a bit.

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    Quote Originally Posted by nobb View Post
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    The senior guys can't afford to retire because they haven't been saving enough/have greatly inflated their lifestyles so they are holding onto their jobs longer. Juniors aren't being hired to fill the lower ranks, so it's the intermediates doing all that stuff. For the intermediates, there's no upwards mobility or any training, so it's just going through day by day and maybe occasionally jumping ship to spice things up a bit.
    So true. I plan to jump ship all-together or perhaps try my hand at a different industry soon. Not as much upward mobility as I'd hoped (though I realized that 5-years ago) and the international landscape has changed a lot (in the MENA region, it is obvious companies are more interested in cheap Eastern labour, even if they do a piss-poor job, than expensive Western guys who know what they're doing). I still haven't figured out how the economics work out as I see way more major f-ups than I did a decade ago due to this.

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    Yes upward mobility sucks when the industry is shrinking and nobody is retiring.

    I've heard some incredible stories of incompetence and inefficiency from MENA and China. Baffling stuff.

    I know someone in Calgary, training Chinese guys here, so they can drill thier wells back home faster. Current average is 85 days. My buddy estimates they are 20 day wells here without any fancy equipment.
    Last edited by ExtraSlow; 01-18-2020 at 10:17 AM.
    Quote Originally Posted by killramos View Post
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    You realize you are talking to the guy who made his own furniture out of salad bowls right?

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    Quote Originally Posted by davidI View Post
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    So true. I plan to jump ship all-together or perhaps try my hand at a different industry soon. Not as much upward mobility as I'd hoped (though I realized that 5-years ago) and the international landscape has changed a lot (in the MENA region, it is obvious companies are more interested in cheap Eastern labour, even if they do a piss-poor job, than expensive Western guys who know what they're doing). I still haven't figured out how the economics work out as I see way more major f-ups than I did a decade ago due to this.
    What industry would you jump to?

    I kind of feel like with globalization and neoliberal capitalism, this sort of thing is happening to many other traditional industries as well. Not a single young person in O&G is passionate about the industry anymore after been worn out through the downturn and all the politics involved. O&G has always been an old boys club, but the downturn magnified that further and I think the industry has shot itself in the foot by failing to adequately train newer generations.

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    85 days at $5/hour beats 20 days at $60/hour.

    Now train those $5 guys to be twice as good, but give them $7 and tell them what an honour it must be to help mother China prosper.

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    Quote Originally Posted by nobb View Post
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    What industry would you jump to?

    I kind of feel like with globalization and neoliberal capitalism, this sort of thing is happening to many other traditional industries as well. Not a single young person in O&G is passionate about the industry anymore after been worn out through the downturn and all the politics involved. O&G has always been an old boys club, but the downturn magnified that further and I think the industry has shot itself in the foot by failing to adequately train newer generations.
    Definitely. It's a race to the bottom as far as costs go in many ways and the consumerist 'throw-away' / 'upgrade cycle' culture has destroyed the need for quality goods or services. I think the "old boys" club has been hit by the whole snowflake #metoo I'm offended culture where things just can't work like they used to. Some of that change is surely for the better but at the same time, the industry doesn't feel as personal or network-based anymore which makes everything feel a little less meaningful.

    As far as my personal situation, I'm looking to FIRE but probably with some "recreational employment" that I enjoy to keep me busy. Not looking to launch a massive business or find another six-figure salary as I enjoy the simple things in life (good coffee, beer, whisky, food, nature, hiking, reading, art, gym, etc.) along with a few more costly hobbies (travel, skiing, snowboarding, golfing, photography, leatherwork, woodwork, knives/sharpening, etc.) and should have enough to cover that lifestyle.

    If I can make some money through hobbies or blogging/vlogging/design/photography etc. that I enjoy doing, then it would be fun to throw it towards random adventures or philanthropic activities.

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    Quote Originally Posted by Tik-Tok View Post
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    85 days at $5/hour beats 20 days at $60/hour.

    Now train those $5 guys to be twice as good, but give them $7 and tell them what an honour it must be to help mother China prosper.
    The thing is, with a lot that I see/hear about, it's the $5/hour guy fing-up $XXX,XXX in equipment or causing $X,XXX,XXX in loss of production/consequential damages or whatever and that's where I can't wrap my head around the economics.

    If you're taking an extra 65 days to drill a well, you're talking about some massive rig and fuel costs that far exceed hiring the knowledgeable guy, even at $500/hr or whatever.

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    Professional ladies are doing huge networking events, I think basically just for women. It's like the reverse He-Man Woman Haters Club haha kidding.
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    Quote Originally Posted by davidI View Post
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    As far as my personal situation, I'm looking to FIRE but probably with some "recreational employment" that I enjoy to keep me busy. Not looking to launch a massive business or find another six-figure salary as I enjoy the simple things in life (good coffee, beer, whisky, food, nature, hiking, reading, art, gym, etc.) along with a few more costly hobbies (travel, skiing, snowboarding, golfing, photography, leatherwork, woodwork, knives/sharpening, etc.) and should have enough to cover that lifestyle.

    If I can make some money through hobbies or blogging/vlogging/design/photography etc. that I enjoy doing, then it would be fun to throw it towards random adventures or philanthropic activities.
    Good to see that the FIRE mentality is really gaining momentum. That's my thoughts as well. O&G incomes are still high, so make and save as much as possible for now to purse FIRE sooner. Then when you've reached a point where finances are no longer top priority, be able to take different risks or pursue more lifestyle oriented goals.

    It's the most logical way IMO, because we really have no idea how this industry is going to be like in 10-20 years and I'd rather not be grinding away for a paycheck by then. The oil & gas guys can argue as much as they want about climate change, pipelines, and that sort of stuff but the reality is that as an individual I have no control on how things will turn out. The only thing I can control is how I manage my finances and align myself in a financially sustainable way.
    Last edited by nobb; 01-18-2020 at 02:21 PM.

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    The big crew change turned into a big myth when the industry started laying people off by the thousands. The situation now seems to be a glut of overpaid boomers at the top of the industry that are slow to adapt to the new challenges and realities of today's oil and gas business. The top talent with the skills and ability to implement new technology like data science and AI are typically younger and unable to achieve the top dollars the old boys club continue to enjoy.
    As it stands today, I would say there are way more companies and management teams than are needed to develop the resources in Canada, but the entrenchment of leadership is preventing mergers and acquisitions from changing that. For example, do we really need 20+ different companies developing the Montney or could it be done more efficiently with several larger organizations? The result of that, however, would be many high paying board seats and executive jobs being lost with no line of sight to the next opportunity.

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    Quote Originally Posted by davidI View Post
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    So true. I plan to jump ship all-together or perhaps try my hand at a different industry soon. Not as much upward mobility as I'd hoped (though I realized that 5-years ago) and the international landscape has changed a lot (in the MENA region, it is obvious companies are more interested in cheap Eastern labour, even if they do a piss-poor job, than expensive Western guys who know what they're doing). I still haven't figured out how the economics work out as I see way more major f-ups than I did a decade ago due to this.
    Forethought isn't as common as one would hope.

    I suppose ironic coming from someone currently unemployed.
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    Quote Originally Posted by Perceptionist View Post
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    The big crew change turned into a big myth when the industry started laying people off by the thousands. The situation now seems to be a glut of overpaid boomers at the top of the industry that are slow to adapt to the new challenges and realities of today's oil and gas business. The top talent with the skills and ability to implement new technology like data science and AI are typically younger and unable to achieve the top dollars the old boys club continue to enjoy.
    As it stands today, I would say there are way more companies and management teams than are needed to develop the resources in Canada, but the entrenchment of leadership is preventing mergers and acquisitions from changing that. For example, do we really need 20+ different companies developing the Montney or could it be done more efficiently with several larger organizations? The result of that, however, would be many high paying board seats and executive jobs being lost with no line of sight to the next opportunity.
    All my friends with a HR background absolutely absolutely hate working Big Oil... the culture is the same, I worked at 2 organizations and its a culture of fear, uncertainty and doubt... Outcome driven Bossing (not leadership) and people tolerate this because of two things: "Money" and "Prestige"

    I think at one point, I wouldn't argue the point that as Oil paid top core tile that they often employed top performers... but over the last two recessions and an emerging generation of millennial's who places greater values of job satisfactions on culture, contributions, collaboration and innovation than compensation.. I feel that other more Product driven organizations are able to attract top "younger" talent without having to compete with O&G rates.

    I'm not one to be all about workplace equality or anything that has to do with affirmative action, but over the course of my career, I will admit that unless the company is appointed a strategic leader by its majority stakeholder (i.e. single benefactor and or a venture capital firm), most O&G organizations are front-ended and successors appointed to tall white boomer patriarchy. For me this reason alone, much like the Republican party, is what stalls progressiveness in culture and innovation in O&G, especifically with Canadian O&G.
    Last edited by r3ccOs; 01-18-2020 at 06:06 PM.

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    Oil and gas can't even get white male privilege right. As beyond.ca member have proven.
    Quote Originally Posted by killramos View Post
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    You realize you are talking to the guy who made his own furniture out of salad bowls right?

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    Quote Originally Posted by Perceptionist View Post
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    For example, do we really need 20+ different companies developing the Montney or could it be done more efficiently with several larger organizations?
    I would hate that. When Crescent Point was running SE SK it was a fucking nightmare to try to work there.
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