Human resources practices of oil and gas companies need to integrate upskilling of their employees within its policy framework and future vision. As a best practice, it should be a continuous process and not just an instant fix during challenging times.
To further establish the importance of skill set upgradation in the oil and gas industry let us start with the definition:
What is Upskilling?
Upskilling is training an employee on new technology or process to improve his present capabilities. It makes the individual future-ready for upcoming technologies and methodologies, especially the ones related to his skill set and aptitude.
Why is it important to Upskill the workforce?
There are two major reasons:
Manual human labour is always at war with the rapid evolution of technology. New technologies have improved productivity by automating processes and replacing large-scale workforce with advanced machine-learning and AI tools.
This has in-turn led to an abundance of traditional talents and a steep rise in demand for experts who can control this new generation human-machine ecosystem. Upskilling in such a scenario can enable the workforce to use new technology and bridge the skill gap.
Also, it may be more expensive to hire new employees and train them rather than develop ways to nurture talent that’s already there in the company’s workforce; Upskilling is such a scenario will act as a strong retention strategy.
For example, in the last 1800s, rotary drills used to be in operation to drill out oil. Now, the oil and gas industry has technologies like seismic imaging and the latest measurement while drilling technology (MWD) to enhance the productivity of oil drilling. A drilling team that is well versed in the newest technology will always prove to be an asset to the company and vice-versa.
However, upskilling in not restricted to hard skills alone; In the energy industry, soft skills are vitally important, especially because of the rigorous nature of work. Professionals from diverse national backgrounds, cultures, and habits come together to work in the industry. They work in a difficult environment away from family and friends.
Interpersonal skills, ability to communicate clearly, and leadership capabilities are vital to keeping the team working and happy.
Skill set upgradation is a continuous process. Why?
It is quite unfortunate that the implementation of upgrading oneself be it learning new tools & technologies or keeping up with the latest industry trends is not proportional to the advancement of technologies. Hence there is always an imparity in demand and availability of talent.
The only way to bridge the gap between talent demand and supply is timely identification of industry trends and recalibrating oneself by learning the new.
Competition is a big driver of upskilling
Globalisation has opened up new markets. Needless to say, the recruitment department has witnessed a rapid growth of tech-savvy and competitive talent base. For the new-age engineers and entrepreneurs, technology is not something to learn; it is a way of life. When they join the global economy, they will steer everything on the motherboard of technology. The amalgamation of old and new talent would be incongruous if the industry stays away from this mission.
The oil and gas industry has its own downturns and upturns, but such is the importance of energy in the modern world, that it continues to be the force majeure in the economy.
Upskilling through technology courses, in-service training programmes, soft skill modules, and software skilling programmes can keep both employees and employers ready to face the competition and the future.
Nrgedge.net has for long partnered with the industry to equip energy personnel with advanced skill sets in various job profiles and positions. Visionary industry experts have lent their minds to design and develop the upskilling courses to facilitate the process of capability enhancement and professional advancement.
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This winter, natural gas prices have been at their lowest levels in decades. On Monday, February 10, the near-month natural gas futures price at the New York Mercantile Exchange (NYMEX) closed at $1.77 per million British thermal units (MMBtu). This price was the lowest February closing price for the near-month contract since at least 2001, in real terms, and the lowest near-month futures price in any month since March 8, 2016, according to Bloomberg, L.P. and FRED data.
In addition, according to Natural Gas Intelligence data, the daily spot price at the Henry Hub national benchmark was $1.81/MMBtu on February 10, 2020, the lowest price in real terms since March 9, 2016. Henry Hub spot prices have ranged between $1.81/MMBtu and $2.84/MMBtu this winter heating season (since November 1, 2019), generally because relatively warm winter weather has reduced demand for natural gas for heating. Natural gas production growth has outpaced demand growth, reducing the need to withdraw natural gas from underground storage.
Dry natural gas production in January 2020 averaged about 95.0 billion cubic feet per day (Bcf/d), according to IHS Markit data. IHS Markit also estimates that in January 2020 the United States saw the third-highest monthly U.S. natural gas production on record, down slightly from the previous two months.
IHS Markit estimates that U.S. natural gas consumption by residential, commercial, industrial, and electric power sectors averaged 96 Bcf/d for January, which was about 4.4 Bcf/d less than the average for January 2019, largely because of decreases in residential and commercial consumption as a result of warmer temperatures.
However, IHS Markit estimates that overall consumption of natural gas (including feed gas to liquefied natural gas (LNG) export facilities, pipeline fuel losses, and net exports by pipeline to Mexico) averaged about 117.5 Bcf/d in January 2020, an increase of about 0.2 Bcf/d from last year. This overall increase is largely a result of an almost doubling of LNG feed gas to about 8.5 Bcf/d.
Because supply growth has outpaced demand growth, less natural gas has been withdrawn from storage withdrawals this winter. Despite starting the 2019–20 heating season with the third-lowest level of natural gas inventory since 2009, by January 17, 2020, working natural gas inventories reached relatively high levels for mid-winter. The U.S. Energy Information Administration’s (EIA) data on natural gas inventories for the Lower 48 states as of February 7, 2020, reflect a 215 Bcf surplus to the five-year average. In EIA’s latest short-term forecast, more natural gas remains in storage levels than the previous five-year average through the remainder of the winter.
According to the National Oceanic and Atmospheric Administration (NOAA), January 2020 was the fifth-warmest in its 126-year climate record. Heating degree days (HDDs), a temperature-based metric for heating demand, have been relatively low this winter, which is consistent with a warmer winter. During some weeks in late December and early January, the United States saw 25% to 30% fewer HDDs than the 30-year average. This winter, through February 8, residential natural gas customers in the United States have seen 11% fewer HDDs than the 30-year average.
Source: U.S. Energy Information Administration, based on National Oceanic and Atmospheric Administration Climate Prediction Center data
Headline crude prices for the week beginning 10 February 2020 – Brent: US$53/b; WTI: US$49/b
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