Workforce Survey h1 2013

The GlobalOil & GasWorkforce Survey

Expectations for Hires and Pay rates in the oil and gas industry H1 2013

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Introduction 1

Survey Summary 2

Africa 3

Americas 4-5

Asia Pacific 6-7

Australasia 8

FSU - Caspian 9

Europe 10

Middle East 11

Regional Comparisons 12-13

Staffing Projections 14

Air Energi Overview 15

OilCareers Overview 16

Contacts 17

Copyright @ Air Energi Group LimitedDisclaimer: The Air Energi, OilCareers.com H1 Workforce Survey 2013 is representative of an added value service

to clients and candidates. Whilst every care is taken in the collection and compilation of data, the survey report is interpretive and indicative not conclusive. Therefore information should be used as a guideline only.

Contents

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Welcome to another edition of the Air Energi and OilCareers.com Workforce Survey of trends and predictions for the energy sector. Now in our fourth year of this publication, we have to look at how much we have developed and grown to accommodate the vast changes that have occurred over the past few years. We are moving into an innovative period where we can offer new tools to companies we work with and are seeing us pull away from our competitors throughout the industry.

Within the oil and gas industry, there is much change afoot.

Advances in technology are opening up new production methods,

new frontiers are being explored and as always, people are the

critical component required to advance the ball. Without the right

expertise for the job, nothing comes out of the ground.

Given the scale and scope of today’s mega projects, one

announcement can have a ripple effect on the operations of

the entire industry worldwide, as we have recently witnessed in

Australia and the United States. The demand for LNG and subsea

personnel is being acutely felt the world over, having a direct impact

on project costs and delays. It’s a fascinating time to be in the

industry right now, though certainly not an easy or predictable one,

and arguably those with the right combination of funding and agility

will best survive.

Thank you for your ongoing interest in this publication. As always,

we welcome your comments or suggestions. Wishing you a very

prosperous, safe and exciting 2013.

Ian M LangleyGroup Executive Chairman

[email protected] behalf of Air Energi

Introduction

At OilCareers.com, we are delighted to introduce the first Workforce Survey for 2013 in partnership with Air Energi. The survey remains in line with predictions from H2 2012, showing that regardless of the challenges and concerns, the industry continues to build towards a positive outlook for the economy worldwide.

With both security and HSE issues dominating news headlines,

the energy sector has been thrust into the spotlight, with many

left wondering how it will respond. However, with increased

security measures and political backing accompanied by growing

opportunities related to unconventional reserves, oil majors

refuse to allow this to divert from the penetration of new frontiers,

while stepping up efforts to encourage talent to higher risk areas

with an inflation of salaries into 2013.

Potentially counteracting this excitement and anticipation around

renewed opportunities, is an issue which still presents an

uncertain overcast for the sector, the global skills gap, which sees

a lack of young people willing to delve into the industry, potentially

counteracting its view to sustainability.

Despite this much documented concern, in true fashion, the

statistics suggest that the industry is fighting back, with an increase

in both salary and hiring rates across much of the world. As a longer-

term view to continuous development, we see the industry has also

responded with investments in both educational programmes and

local labour in order to ensure a constant filter of new talent.

As the world’s largest online dedicated oil and gas job board, our

objective is to provide our candidates with access to a variety of

positions spanning the entire oil and gas supply chain. With more

than 20,000 new candidate registrations per month and 750,000+

searchable CVs, we in turn help recruiters and organisations in

their continued quest to source the best solutions.

Mark GuestManaging Director

[email protected] behalf OilCareers.com

1© Air Energi 2013

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Global Survey Report

Salary and Pay Rates

100

90

80

70

60

50

40

30

20

10

100

90

80

70

60

50

40

30

20

10

H22010

H12010

H1 2011

H22011

H1 2012

H22012

H1 2013

Increase Decrease No Change

100

90

80

70

60

50

40

30

20

10

H22010

H12010

H1 2011

H22011

H1 2012

H22012

H1 2013

Hiring Rate

H1 = statistics/predictions for the first half of the year, H2 = statistics/predictions for the second half of the year.

H1 (2013) Survey Summary

Air Energi and OilCareers.com would like to thank all organizations and participants who took the time to respond to and influence our survey and report. The returns clearly show a substantial response from decision makers and industry insiders across all the oil and gas producing regions. We are pleased to present the findings in this report for our industry partners to utilise in their future decision making.

• 170,000 + oil and gas professionals were invited to participate

• 15,500 + were either direct recruiters or senior decision makers

• Over 50 countries represented in seven major oil and gas producing regions

Percentage of responses from each geographical region

Australia 13%

Middle East 13%

APAC 16%

Americas 22%

FSU Caspian 10%

Africa 9%

UK - Europe 17%

© Air Energi 20132

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creating an increased demand for qualified personnel, whether local or expat. Subsea talent remains in high demand and likely to increase once Angola gets its own pre-salt exploration programs underway. New labour reform measures have been implemented recently, geared toward improving working conditions and improving government transparency in the oil and gas sector, the backbone of the Angolan economy.

NigeriaThe Nigerian government has recently approved a $3.5 billion national electricity grid to put an end to the country’s chronic power shortages. Ironically, Nigeria seeks to raise much of the capital required through foreign partners, in exchange for which the government promises increased operational transparency and above-board administration. Proposed timelines are to have the new ‘supergrid’ completed by 2014; specialised subsets from local oil and gas exploits may migrate to this groundbreaking project.

Yet another federal election is threatening to backburner the proposed Petroleum Industry Bill (which would effectively rewrite the legal and fiscal basis of Nigeria’s relationships with IOCs) once more, potentially delaying billions of dollars in energy industry investments. Until fully revealed and understood, the controversy surrounding the Bill will result in a slowdown in some major projects, operators opting to remain in holding pattern until it is known what real effect the bill will have on corruption and security concerns.

“BP chief executive said: “PSVM is one of the largest subsea developments in the world and was one of BP’s key project start-ups for 2012 as we grow higher-margin production.

“Over the coming decade, we expect Angola, where we have extensive interests from exploration through to production, to be one of the main hubs delivering growth for BP.””

Regional OverviewLabour and operational challenges persist in Africa. In spite

of very positive discoveries coming out of countries like

Mozambique, Congo and Gabon there are confidence-shaking

events taking place in places like Nigeria and Algeria. Yet for oil

and gas exploration to continue, new frontiers have to be met and

challenges dealt with; civil, regulatory, technical or environmental.

International oil majors continue to invest and succeed here

despite these hurdles.

ANGOLADesign offices and fabrication yards in Luanda are being kept

relatively busy, providing FEED and construction work in support

of Angola’s significant offshore E&P activities in spite of strict local

content regulations. Through various channels such as operating

local offices, apprenticeship programs and job site training, IOCs

are able to demonstrate their commitment to the local economy,

though in order to qualify for permission to bring in foreign

expertise it must be proven that the company has tried everything

possible to find a national with the appropriate skill sets. With such

a strong offshore component to its reserves, Angola is competing

directly with the likes of Brazil and the North Sea for top expertise,

particularly in Subsea and HSE disciplines.

NIGERIAMore than 12 years in the making, Nigeria’s proposed Petroleum

Industry Bill (PIB) may be passed as soon as March 2013.

This highly complex and controversial legislation would see a

significant increase in royalties to the Nigerian government over

current levels. Oil majors operating in Nigeria have warned the

$100+ Billion earmarked for CAPEX here through to 2025 will be

rendered “unviable” and that E&P activity could dramatically decline

as a result. Under the current structure, the promise of reduced

government corruption, a fairer share for the Nigerian public and

sustained investment in the oil and gas sector are simply not

adding up according to IOC spokespeople. 2013 may see ongoing

international divestment from the area under the threat of this

legislation, and alongside declining exports to major consumer

markets like the United States, Nigeria may be in for a bumpy

transition.

Expectations for Africa

Africa

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Decrease No Change

26.8%62.5%

Increase

10.7%

Decrease No ChangeIncrease

26.8%69.6% 3.6%

Contract + Salary Pay Rates

Amount of Hires

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“America is almost self-sufficient in oil production and is now turning down offers from traditional overseas oil suppliers.”

Regional Overview

Things are rarely status quo in the Americas. Seemingly overnight, Colombia and Argentina are asserting themselves among the major energy players on the continent, the future of Canada’s oil sands is shifting, and impacts from the quick development of shale gas and shale oil plays in the United States have changed the world energy spectrum even over the past six months. Offshore E&P has kicked into high gear in the Gulf of Mexico, and Canada and Alaska are getting a glimpse of what may be in store as the development of Arctic reserves becomes a reality. Rates and labour supply in North America are reasonably stable, though it remains to be seen where the offshore and LNG expertise (in short supply the world over) will come from to support projects in South America.

ARGENTINABillions are already being shovelled into E&P in Argentina in an attempt to boost production and reduce dependency on oil and gas imports. But a further estimated $250 Billion will be required to fully develop its vast shale gas reserves, so the courtship of private investors has begun in earnest from Houston to Norway to Moscow. Shale gas and vast reserves of shale oil have been confirmed here, so besides dollars Argentina’s YPF will require the technology, know-how and personnel to bring these developments into full swing. US-based IOCs are stepping up with recent experience in these deposits in their own backyard. The stakes are high: with domestic issues like high inflation and a crippling energy subsidy, the Argentine people and strong unions will most certainly be exerting pressure on the government for a favourable, equitable energy future.

BRAZILBrazil’s burgeoning offshore explorations are resulting in massive industrial spin-offs onshore. Shipyards and fabrication yards are themselves in as high demand as the components they are scheduled to build. Even with the huge increase in fabrication capacity here, however, there are a number of Petrobras projects still being executed in Singapore and China due to lack of capacity

in Brazil. But local content regulations – sometimes as high as 70 per cent – have brought home a number of jobs that were slated to be completed in Asia Pacific. Brazil’s strong unions are ensuring its members (in the tens of thousands) are well represented and able to take advantage of the country’s swift economic growth, pushing for wage hikes of as much as 15 per cent. These combined pressures (capacity, local content, steep wage hikes) have placed Brazil in a pinch as it tries to keep the spotlight on its vast offshore pre-salt deposits.

And so new E&P activity is on deck to commence quarter two of this year, the first time offshore licensing rounds have been held here since 2008. Everyone is hopeful all royalty disputes can be settled between Brazilian states by the time they go up for bidding, lest foreign investors (particularly those based in North America) return home in search of more stable, less technically challenging plays.

CANADAFor the last two years, operators in Canada have been bracing themselves for 2014 as being a peak year, however this has not materialised to the extent anticipated, lending to overall stability and a more sustainable labour pool. Project activity is still busy, albeit down a couple notches from the frantic pressure being experienced in other markets. A key element in the cooling here (besides the infamous Canadian winter) is down to ongoing uncertainty surrounding Canada’s nearly maxed-out pipeline capacity, which has operators asking whether to increase production or maintain current levels. Alberta is scrambling to find ways of getting product to market, along with identifying which markets those may be. The government is concurrently trying to develop strategies to support the industry and turn around the somewhat softened demand for Canadian crude. Large players with deep pockets are continuing apace, but if an apparent solution does not materialise soon then smaller developers may get left behind.

In contrast to the prairies, there is a heightened interest in E&P activity offshore Atlantic Canada, with several new blocks having been snapped up recently. While this is forward momentum, the impact to recruiters’ desks is several quarters out.

Overall, hiring activity in Canada is at a measured pace for the moment, with a natural transition from design through to construction, field and optimisation areas being observed. Demand for commodity disciplines such as electrical and piping engineers has reduced, but all that could change with hoped-for west coast LNG terminal and pipeline project announcements.

Americas

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COLOMBIAColombia’s petroleum industry needs every bit of good news it can get following years of guerilla attacks, labour unrest, and dwindling reserves, but exploration is slated to continue at a brisk pace through 2013. The country now ranks third only behind Brazil and Australia in terms of E&P potential and activity. Chevron, Shell and ExxonMobil have all pledged significant interest and investment in Colombia’s unconventional gas reserve exploration, and given a successful outcome to the peace talks currently underway between the government and rebel factions, that trajectory will only increase. Shale gas technical expertise will be in high demand and short supply here, competing with similar projects in Australia and more recently the United States.

USA2013 will be a big year for operators involved in shale gas plays throughout the United States, buoyed by increasing demand for LNG (for domestic and export markets) as well as significant international investment interest. Assets that were once used to import petrochemicals are being flipped into export hubs, and several downstream refineries and related infrastructure are also underway (such as a $17 billion Gas To Liquids plant near Lake Charles, estimated to employ some 17,000 people). Engineering and construction work is readily available across all stages and disciplines. Fortunately for the US, thanks to its long-standing refinery and manufacturing sectors it has a relatively solid domestic pool from which to recruit for the moment. As expected, the high levels of activity underway have created a candidates’ market, though rates remain stable and the trend toward permanent hires versus contractors observed in 2012 continues. What becomes of labour availability as LNG projects well and truly get into full swing (as in Australia) remains to be seen.

Though shale gas may be in the spotlight at present, activity is also picking up within unconventional oil plays (especially those with gas deposits) as well as offshore projects, with new E&P work underway and increasing rig count in these areas. Already this year there appears to be more job orders than qualified candidates, particularly those related to downstream disciplines and eligible for direct hire as companies seek to expand their headcount.

VENEZUELAVenezuelan president Hugo Chavez is urging state petroleum and metals industries to work together, invest billions, build cities, bring employment to hundreds of thousands of workers, and achieve “Complete Oil Sovereignty” in the long-awaited full development of its Orinoco heavy-oil belt. Yet Venezuela’s track record for nationalisation of international assets has left both mining and oil and gas investment-starved for years, and in this poor economic position, labour unrest has further plagued these industries. State-run PDVSA’s employee rosters have grown by more than 100,000 people over the last few years, yet production has historically come up shy of the lofty volumes projected by the government. A forthcoming election could bring a new regime, industrial reform, and renewed confidence from the private sector – in short, a much more positive outlook for its resident technical and engineering personnel.

Expectations for Americas

Americas


Decrease No Change

51.6%41.7%

Increase

6.7%


38.3%56.7% 5%


Amount of Hires

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“Senior Industry professionals are optimistic about the near-term outlook for Asia Pacific, but with the rising operating costs and changes as the region transitions to deal with more complex and costly projects, they are cautious saying that the biggest challenge will be growth.”

Regional OverviewAsia Pacific is the hub for much of the world’s shipbuilding and offshore fabrication work, and all the major yards in the region (Singapore and Korea in particular) have been stretched to maximum capacity going into 2013. Given the modularization of some projects, some of the spill-over work has even landed in China, Thailand, Indonesia and Philippines. Project delays are a certainty this year, becoming a question of how many months rather than weeks in some cases. Besides the physical space required to meet these orders, labour is most certainly becoming scarce; many companies are starting to cast their nets further in the search for manpower with campaigns taking place continually in FSU and Middle East. Across the entire region, the following disciplines are in increasing demand: Naval Architects, Subsea Engineers, Construction Advisors, Project Controls specialists, QA/QC, Safety Engineers and Process Engineers.

JAPANLNG accounts for more than 80 per cent of Japan’s domestic energy imports, so it stands to reason that the country is heavily involved in several diverse and strategic LNG plays around the world. Here, as elsewhere, energy self-sufficiency is paramount, but with few domestic reserves the best Japan can do is to lend its investments and strong technical expertise to the projects it partners itself with. Both Japan and Korea have long-standing experience and expertise in the type of projects currently coming out of Australia, and will each reap the rewards from their investments in these multi-billion dollar projects both in terms of domestic job creation as well as the securement of future energy supply.

KOREASuppliers in shipyard powerhouse South Korea will also enjoy full order books across 2013. Like Japan, South Korea is almost

exclusively dependent on LNG for its domestic energy supply, so is also grabbing up stakes in high-yield ventures in Australia and elsewhere in exchange for drill-ships and other components built here at home. Orders are in place here in the tens of billions of dollars, securing employment for everything from engineering to construction disciplines for the next two to three years at minimum. Given the tidal rise in offshore activity worldwide within both mature and emerging markets, operators will welcome whatever capacity and assistance South Korea can provide.

INDONESIAIndonesia too is feeling the spark of increased investment in its domestic reserves, offering new blocks for bidding, approving dozens of oil and gas development plans, as well as announcing ambitious plans to maximise output from current fields – measures through which an estimated 3,000 new jobs will be created. Partnerships are being signed with regional and international developers, providing a much-needed boost to Indonesia’s lagging output so as to keep up with domestic demand and export targets.

Unlike wide-sweeping NOC regulatory changes elsewhere, Indonesia’s recent shift from BP Migas to SKK Migas has been relatively low impact, with the government ensuring that all PSC contracts will not be affected and any new foreign investment is still welcome. Foreign IOCs will continue to enjoy the latitude they need to operate as required.

MALAYSIAMalaysia’s monster Pengerang Integrated Petroleum Complex (PIPC) could be one of the biggest prospects in the coming years and definitely the largest of its kind to come out of Malaysia. More than 20 EPC contracts are expected to be announced by mid-2013 with construction scheduled to commence later in the year. This $20 Billion project alone will swallow up any and all available Project Management Teams from around the world, and once in full swing an estimated 70,000 workers from all disciplines will be required. But a warming trend is being observed on behalf of Malaysian foreign investment regulations: more Risk Sharing Contracts are being awarded, resulting in a number of smaller operators now getting in on some of the marginal action in Malaysia. As previous, demand remains extremely high here for FEED personnel, Construction Project Managers, Quality and Safety, and HSE. Expertise in drilling exploration, fixed platform and LNG engineering and construction is also highly sought after.

Asia Pacific


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SINGAPORECapacity at Singapore’s shipyards has gone from maxed out to simply overloaded. Billions of dollars in contracts have been awarded for everything from jack-ups to semi-submersibles to FPSOs late last year, leaving fabricators reeling and wondering where to put the extra work. It’s no longer Australia exerting the pressure here; orders are coming in to support offshore endeavours in Brazil, the North Sea and Africa. Engineering and design work on these new FPSO projects are being done in USA, Europe, and within the Asia Pacific region, however the majority of the construction work is being carried out in Singapore and Indonesia. The CAPEX woes in Australia’s LNG plays has obviously had a trickle-down effect to operators involved, resulting in major delays due to design changes and increased scope across a number of EPCs. Additional manpower is in high demand across multiple fabrication and construction locations here.

THAILANDThailand and Indonesia are capturing some of the spillover fabrication capacity from neighbouring Singapore. These regional cross-over benefits are helping Thailand make its own moves toward securing future energy supply, such as engaging in strategic merger and acquisition activity. But the doors to exploration and production remain open to foreign investment, as well as open diplomatic relations with its neighbours in the Gulf of Thailand over potential overlapping development rights. Subsea and LNG expertise, as well as Construction/Project Managers and EPC disciplines remain in strong demand.

VIETNAMThere have been several stories published over the last couple of years warning the industry of the major void that will be created once the 50-somethings retire in the coming decade, leaving behind not only a raft of empty chairs but a serious gap in senior-level technical expertise. Among the players in the region’s oil and gas industry, Vietnam may be particularly well-positioned for the future through a strong engineering graduate and training program (unlike in the UK, for example, where it has been particularly challenging to attract youth to the industry).

In terms of a foreign investment climate, however, there has been no major change for the good. To complicate further, mounting tensions between Vietnam and China over sovereignty in the South China Sea, estimated to contain 200+ billion barrels of oil, are driving exploration costs up and potentially keeping foreign investment dollars out.

Asia Pacific


Decrease No Change

37.5%51.4%

Increase

11.1%


25%73.6% 1.4%


Amount of Hires

Depleting crude oil reserves: The majority of the oil and gas companies in the Asia-Pacific region continue to face either flat or depleting growth in crude oil reserves.

Regulated market environment: Major players in the region are state-owned and operate in a highly regulated market environment. Stateowned companies have limited operational flexibility.

Price volatility: Volatility in oil and natural gas prices continuosly impact operations of the major companies within APAC.

Environmental regulations: Stringent environmental regulations (that are applicable globally) to curb GHG (green house gas) emissions will result in additional capital expenditure, especially on refineries and emission-intensive exploration technologies.

Expectations for APAC Region

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“Coal Seem Gas will be a key part to securing Australia’s energy security now and into the future.”

Regional OverviewDealing with the cost of labour, there seems to be no let-up in the short term. As Gorgon, Wheatstone and the three Coal Seam Gas (CSG) projects in Queensland progress towards the back end of execution (post 50 per cent complete), hiring rates and earnings for construction, commissioning, completion and start up personnel will increase in the next two years due to the expected market pinch. For corporate and technical personnel more likely to be engaged in the front and mid stages of projects, the short term seems reasonably stable with the operator and supply chain involved in the CSG projects, Ichthys and Prelude in particular still hiring at expected rates.

AUSTRALIAThere are currently 15 LNG trains in construction across Australia with a mode average start-up date (subject to no further schedule delays) of 2015. As we head into 2013, the Australian oil and gas industry continues to feel the pressure of this large suite of LNG projects. Gorgon has been the latest to announce a cost blow-out of $9 Billion to a total CAPEX of $52 Billion, owing to labour costs, the strong Australian dollar, logistics and continued local productivity challenges.

In Queensland, all stakeholders in the CSG space seem committed for the long haul regarding the ongoing OPEX / developments required to fuel at least two LNG trains for 25 years. Whether or not Arrow Energy goes it alone or finds a collaborative solution, the upstream aspect and two pipelines involved in the project will have to be executed. It is also worth noting that train 3 of PNG LNG and the Gulf LNG project should both be sanctioned in 2013, helping feed oil and gas employment prospects out of Brisbane.

4,344 kilometers to the west in Perth, Prelude is leading the way. Current FLNG project opportunities seem to tick the operating sponsor’s longer-term boxes as costing and scheduling becomes more assured. These projects bring benefit to Australia not only from a federal tax perspective, but also reasonable career opportunities within the corporate, logistics infrastructure, project management, procurement, contract management, training and operations areas. The second and third FLNG projects (Bonaparte and Scarborough) also seem to be making positive noises.

From an employment perspective, the post-2016 picture is also complicated by the current number of transient oil and gas contractors working in Australia, mostly on 457 or PR visas. From West Africa to the Middle East to Australia, this European engineer community has followed oil and gas project hot spots around the world for the last 15 years. Within Air Energi, a brief overview models that this is circa 20 per cent of our current on-hired contract population, which we feel is a fair representation of the current market. Market share indicators point to this overall population in Australia that relies on a booming contract employment market to be in excess of 10,000 people.

Add to all of the above a potential leadership change at the federal government level and a slight softening in the mining sector, the big question is “will the oil and gas operators gamble on the reduction in LNG project demand to substantially increase productivity, reduce cost of execution and a more assured time schedule or be a case of once bitten, twice shy...”

PNGDespite heavy environmental and regulatory pressures here, exploration investments continue to be made in Papua New Guinea by several oil majors, themselves forming positive relations with government and local operators. Brisbane would be a natural siphoning-off point for technical expertise, but to pull personnel from an already-taut labour market to move to a more adventurous post in PNG may prove challenging.

Expectations for Australasia

Australasia


Decrease No Change

47.4%36.8%

Increase

15.8%


26.3%63.2% 10.5%


Amount of Hires

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“Kazakhstan is planning to increase oil production to 82 million tons in 2013.” Regional OverviewWhereas elsewhere in the world technological advances are helping kickoff the development of discoveries made decades ago, it appears that even for mega projects like the Shtokman natural gas field (which holds an estimated 3.8 trillion cubic meters of gas) the project costs remain too high to be commercially viable. However, as Russia slowly begins to open its doors to foreign oil and gas partners to offer project partnerships, technical collaboration and federal incentives, these investments will eventually bear out to the benefit of the entire region.

KAZAKHSTANSome two years after the deal was signed, the Kazakhstan government has finally agreed to allow consortium partners to recoup their CAPEX and related costs first (prior to payout of state royalties) at the massive Karachaganak oil and gas field, which is estimated to hold five billion barrels of oil equivalent. This is good news for anyone with investment in, or eyes on, Kazakhstan; signals of a more positive and cooperative administration could be all that is required for the country to unlock its vast crude oil reserves and capitalise on its strategic location between Europe and Asia. The question remains as to whether the foreign personnel required to plan and operate these projects decide to follow the investments. But Kazakh NOCs have promised to do their part to make a contract in Kazakhstan an attractive one in order to attract the thousands of foreign specialists estimated to be required to keep mega projects like Karachaganak and Kashagan moving forward to the next phase.

AZERBAIJANAzerbaijan’s mega Shah Deniz gas field, which contains an estimated 30 trillion cubic feet of resources, has recently been given the go-ahead with project partners to extend the PSA through to 2036. With Western Europe as its number one customer, this is good news for both Azerbaijan as well as European countries seeking to diversify their energy supply. But the country’s vast oil and gas wealth has not as yet translated into jobs for the majority of unemployed Azerbaijanis, many of whom hit the streets in several centres recently over ongoing unemployment and social issues. Azerbaijan largely does not have the social infrastructure to fund universities and technical schools, so in order for projects like Shah Deniz to succeed it will be almost exclusively dependent on foreign expertise.

RUSSIAIt’s boomtown in Moscow these days, with Russia reporting that oil output is at an all-time high, even to the point that it is claiming to have displaced the long-reigning Saudi Arabia as the world’s biggest oil producer. With uncharacteristic swagger, administrations here and across the Caspian region are opening their doors to foreign investments and project partnerships. Even the Russia’s colossal Rosneft and Gazprom have joined forces under a cooperation agreement to enable the two companies to share technology and infrastructure to drive offshore exploration. Here, as elsewhere, demand (particularly out of Europe) will drive the pace at which these projects are able to proceed, despite the best intentions of the administration and NOCs.

Yet in spite of mega projects currently underway that are prepared to pay top dollar for good people, there is still a significant skills gap here. Russian technical graduates are keen to secure contracts in the West, whereas Russia (in particular, Moscow) is becoming an increasingly cosmopolitan and attractive employment destination for Western professionals seeking experience abroad, but Russian bureaucracy remains a significant hindrance.

Expectations for FSU - Caspian

FSU - Caspian


Decrease No Change

50%16.7%

Increase

33.3%


50%50% 0%


Amount of Hires

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“The North Sea is a vital national asset to the UK. December 2012 saw a £1 billion project for the development of two oil fields in the North Sea being given the go-ahead..”

Regional OverviewFlexibility and open access to quality education and health care systems keeps EU residents at home, and for expats, Europe offers a very high standard of living. There are in addition a broad range of professional opportunities here in design work for on- and offshore projects worldwide. Some FEED work has commenced in the North Sea, but disciplines in rather short supply also include Safety, Civil / Structural and Environmental Engineers, E&P disciplines, Geophysicists and Geoscientists. Traditional areas within Process and Design are not feeling the same pinch.

SCANDINAVIARecord investments in Northern European oil and gas have set a confident tone for 2013, with new EPC work destined for developments in the North Seas is keeping Norwegian / European design houses and fabrication yards busy. Whilst these projects range from enhanced production out of existing fields to the commissioning of new discoveries, most share one commonality: they are being enabled at the present moment because of technological advances. Thousands of jobs are being created because the technology required to proceed with discoveries made decades ago is at last commercially viable in today’s competitive oil and gas market. And advances made and tested in North Sea waters will help pave the way for future explorations in the Arctic.

UKRecord-setting investment and strong government support are increasing investor confidence in the region into 2013. On the one hand, new large-scale projects like Cygnus will create thousands of jobs in the region from design through to construction. But the UK is also keen to maximise efficiency out of its existing developments: the “Brown Field Allowance” passed in September provides tax shelter for a portion of revenues derived from mature fields on the UK Continental Shelf, prolonging the lifespan of these projects and creating thousands of jobs to support.

On the personnel side, as mentioned specialist disciplines are in very short supply. Graduate programs are not attracting the

right amount of people into the industry, and where good grads are found, it’s often a case of too little, too late. Several majors have opted to establish their own graduate training programs but these are not yielding the volumes of personnel required to top up the rosters of today’s mega projects. Attrition is an ongoing challenge, though completion bonuses are helping improve retention and settle rates. Unlike other comparable regions (such as North America) operators and EPCs here have experienced little traction with driving permanent roles over contract.

MAINLAND EUROPEIn this candidate-driven market, operators and EPCs can quite easily find themselves in bidding wars for top people, as the industry experienced during the labour crunch in 2008. In response to the attrition merry-go-round, and in an effort to help keep rates in check, European design houses and operator projects have instead elected to put healthy completion bonuses on offer to both staff and contractors. Heading into 2013, rates have largely remained steady. However, EPCs here are all struggling to find the right people, particularly for FPSO design work. European residency is almost a must, so companies are somewhat limited to source through traditional areas like networking events, social media and job boards.

Expectations for Europe

Europe


Decrease No Change

40.8%38.8%

Increase

20.4%


32.7%46.9% 20.4%


Amount of Hires

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“The upcoming Saudi Aramco projects which are estimated at more than SR 308 billion are expected to open up huge employment opportunities for Saudis.”

Regional OverviewQatar and the UAE are still considered to be positive destinations for ex-pats, offering high quality of life, competitive rates, tax breaks and long-tenured placements to lure expertise out of design hubs like London and Houston. The concerns over a mass exodus out of the Middle East to LNG hotspots in Australia and Asia Pacific seem to have subsided, with a natural filtering-out of onshore versus offshore LNG expertise. The region continues to attract foreign investment dollars and rates have remained consistent throughout. Site construction personnel are most in demand along with senior-level engineers.

IRAQIraq continues to open its doors to foreign investment to increase production from its significant reserves (estimated to be the third largest in the world), as well as improve its lagging downstream infrastructure. Adding to the positive momentum here is an anticipated agreement between Iraq and neighbouring Kurdistan over control of shared oil resources. Whilst Iraq may not be a prime destination for ex-pats seeking assignment in the Middle East, other regions such as Dubai are establishing themselves as hubs for personnel assigned to major projects here, easing logistical concerns surrounding safety, work visas and worker accommodations. As all aspects of oil and gas production continue to advance, they bring large-scale employment opportunities for everything from unskilled to professional trades.

QATARQatar has been in a flat state in terms of production levels since the last of its major gas trains came online two years ago and at present there are relatively few project announcements. Analysts forecast that Australia is well-positioned to overtake Qatar as the leading exporter of LNG within the next four to five years. Yet Qatar is looking to maintain its competitive position among LNG exporters by exploring opportunities to partner on major shale gas plays underway in the United States. Major onshore project Barzan should create a spike in demand for many construction and related disciplines, but is not anticipated to commence until late next year. Project activity and hiring trends are expected to remain relatively light, with operators focusing their energies on smaller projects, maintenance, and production optimisation.

Middle East


UAEAbu Dhabi is the regional hotspot for project activity with offshore and refining projects expected to pick up across the year. The Emirates plan to significantly increase production to meet domestic requirements, investing tens of billions of dollars across multiple petrochemical developments. Unlike other markets whose resources are booming but are starved for talent, the UAE remains a preferred destination for ex-pats, offering competitive rates, tax incentives and easy standard of living. Design offices overseas will be kept busy in support of projects here, particularly with senior-level engineering and construction expertise. Locally, fabrication yards in Dubai are busy fulfilling orders destined for the North Sea and elsewhere.

SAUDI ARABIASaudi Arabia remains extremely busy into 2013, and activity is expected to continue a steady pace across the year as multiple downstream and refinery projects (such as SATORP) come online. However, despite an impressive list of mega-projects underway attracting senior expertise to the region can prove difficult. As compared to other parts of the Middle East, rates are generally stretched as high as they can go. But for most ex-pats, there needs to be a specific reason to accept a contract in a country that provides few easy inroads for daily life. Lead engineers with 15+ years experience are in particularly high demand here.

Expectations for the Middle East


Decrease No Change

41.5%45%

Increase

Amount of Hires

13.5%


35.1%60.4% 4.5%

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Regional Comparisons

Key

Africa - Contract - Salary Pay Rates100

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Africa - Hiring Rate

Americas - Contract - Salary Pay Rates 100

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Americas - Hiring Rate

Asia Pacific - Contract - Salary Pay Rates 100

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Australasia - Contract - Salary Pay Rates100

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H1 = statistics/predictions for the first half of the year, H2 = statistics/predictions for the second half of the year.



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Key

FSU - Caspian - Contract - Salary Pay 100

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Europe - Contract - Salary Pay 100

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Middle East - Contract - Salary Pay100

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Middle East - Hiring Rate

H1 = statitics/predictions for the first half of the year, H2 = statistics/predictions for the second half of the year.



Regional Comparisons

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Staffing Projections

With all of the current demands on staffing we asked what kind of solutions are in place and what the main issues are going forward. Which specialist role is in the highest demand within your organisation?

What do you think is the biggest current threat to the Oil & Gas industry?

What challenges do you see in your employee training program?

Drilling 9.4%

14 © Air Energi 2013

Project Manager 26.1%

Contract Administrator9.4%

Geologist 2.4%

Engineer 52.6%

Safety Regulations 7%

Labour Costs 4.5%

Economic Instability 34.3%Capital Costs 9%

Visa / Immigration 13.2%

Skill Shortage 32%

Lack of Budget 31.8%

Lack of skilled trainers20.3%

Not getting quality candidates 26.5%

Can’t offer the full selection of training 21.4%

Which roles are in highest demand

Training issues

The biggest threat to the oil and gas industry

Air Energi is the trusted supplier to the oil and gas industry. With over 30 years experience in the sector our goal is to become the recognised, foremost provider of trusted expertise to the international oil and gas industry.

The Air Energi Group has ventures in over thirty countries across the globe and deploys engineering professionals in over fifty countries. Our clients are driven by the need to reduce costs, improve efficiency of recruitment and to concentrate on delivering major projects on time and to budget. Increasingly our clients want to outsource the recruitment, pay rolling and logistical support for a growing percentage of their workforces. Air Energi provides a comprehensive range of services which allow us to deliver a total personnel solution on any scale, at any point in your project life cycle or field development and at all your locations.

With offices in 35 locations worldwide, and through our company values: Safe, knowledgeable, innovative, passionate, inclusive and pragmatism, WE DELIVER, each and every time.

Our range of services include:

Technical Contractor/Consulting - The identification, mobilization and support of technical consultants assigned to major oil and gas projects worldwide.

Global Mobility Services - Tax and payroll, immigration, transport, health, security, accommodation and on-going care.

Project Teams - Fully equipped, multi-disciplined teams for major oil and gas capital development projects.

Search - Bespoke contingent, retained and volume recruitment campaigns for permanent staff needs.

Recruitment Process Solutions - Experienced oil and gas recruitment experts working to deliver highly efficient resources to projects around the globe.

Strategic Consulting (trusted expertise) - Air Energi’s expertise and knowledge is increasingly being sought to develop and deliver workforce solutions to a range of challenging situations.

Key Stats• 3000 consultants currently assigned to major projects• Workforce 60% local/regional hires and 40% Western Ex-pats• Present in 35 global locations• Experience in a total of 50 countries• Major clients include ExxonMobil, ConocoPhillips, Shell & Total• EPC clients include Worley Parsons, Wood Group, AMEC, Bechtel and KBR


OilCareers was launched in 1999, and has become the giant of online recruitment within the Oil & Gas industry. We provide job seekers with an easy and effective way of searching for a new job or career across all specialisms in the Oil & Gas industry.

Our heritage, size and global reach, mean we are best placed to

match professionals to the right job, and provide recruiters with

the best value and a wide range of advertising opportunities to

access the largest global talent pool of job seekers.

OilCareers offers one of the industry’s most visited websites with

over 1.5 million visits each month. The site already helps some

of the biggest and most reputable employers in the Oil and Gas

industries to advertise their vacancies.

We provide instant job advertising for the Oil and Gas industry

to both local and worldwide audiences, with offices serving the

global industry hubs of the North Sea, US, Canada, Middle East,

Asia and Australia, bringing employers, agencies and candidates

together efficiently and confidentially.

With an unparalleled web presence, continuous online and offline

marketing, and a dedication to matching the best candidate to the

right job as easily and effectively as possible, OilCareers is a vital

resource for all companies recruiting in Oil & Gas.

Key Stats

• OilCareers receives over 1.5 million visits per month

• Over 800,000 unique visitors per month

• More than 1.2 million registered users

• Over 20,000 new candidates registering each month

• A CV database of over 750,000 searchable CVs

• Over 18,000 new vacancies posted each month


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Contacts

AmericasAir Resources Americas LLC6002 RogerdaleSuite 340, Houston Texas, 77072, USATel: +1 281 983 3464 Fax: +1 281 983 3468 [email protected]

Asia PacificAir Energi Group Singapore Pte Ltd1 North Bridge Road#06-03/04 High Street Centre Singapore, 179094 Tel: +65 6511 1060Fax: +65 6511 1050 [email protected]

AustralasiaAir Consulting Australia Pty LtdLevel 8, 46 Edward Street Brisbane, QLD, 4000Australia Tel: +61 (0)7 3056 0900 Fax: +61 (0)7 3112 2601 [email protected]

CaspianAir Energi Caspian LLP 6 office, 4 floor, 113 Kulmanov st.Atyrau, Kazakhstan 060011 Tel: +7 7122 [email protected] UK, Europe & AfricaAir Resources Ltd4th floor, Delphian House, RiversideNew Bailey Street, ManchesterM3 5FS United KingdomTel: +44 (0)870 112 [email protected]

Middle EastAir Resources Qatar3rd floor, Qatar First Investment Bank / Al Jazeera Finance Building, PO BOX 2953C Ring Road, Doha, QatarTel: +974 4462 0886Fax: +974 4462 6675 [email protected]

The Air Energi and OilCareers.com Global Oil & Gas Workforce Survey © 2013

Contributors Public Relations and Design: Ben Quinton, Introductions from Ian Langley and Mark Guest


United KingdomOilCareers LtdUnit 22, Abercrombie CourtArnhall Business ParkWesthill, AberdeenshireAB32 6FE United KingdomTel: + 44 0122 454 8080

United StatesOilCareers.com Inc11490 WestheimerSuite 850, HoustonTexas, 77077, USATel: +1 713 425 6316

DubaiOilCareers.comAl Thuraya Tower II, Executive office No. 18 – 6th floorP. O. Box 500643Dubai, UAETel: +971 4 4280618

Australia, BrisbaneOilCareers Pty LtdLevel 3,130 Commercial Rd,Teneriffe, Qld 4005AustraliaTel: +61 07 3872 6000

Australia, PerthOilCareers Pty Ltd464 Hay Street,Subiaco, WA 6008,AustraliaTel: +61 08 9489 5400

CanadaOilCareers.com1333 8 St SwCalgary, AlbertaT2R 1M6, CanadaTel: +1 403 209 3551

17© Air Energi 2013

Workforce Survey h1 2013

Documents

Transcript of Workforce Survey h1 2013