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Workforce Observations

This presentation discusses the impact of demographics and cycles on the oil and gas industry workforce. It explores the changing age demographics in developed and developing nations, the geopolitical shifts, oil production trends, and the relationship between oil prices and the economy. It also addresses the challenges and strategies for managing dual careers in the industry.

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Workforce Observations

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  1. AAPGInternational Conference and ExhibitionCape Town, South AfricaOctober, 2008 Workforce Observations Scott W. TinkerPresidentAmerican Association of Petroleum GeologistsBureau of Economic GeologyJackson School of GeosciencesThe University of Texas at Austin

  2. Observations • Demographics • Cycles • Balance and Bridges

  3. 180 160 140 120 100 80 Population (mm) 60 40 20 0 5 30 40 45 50 55 60 65 35 80 70 75 20 25 90 95 10 15 85 100 Age Age Demographics Developing Nations Brazil '03 India '01 Saudi '04 Mexico '03 Source: UN Website

  4. 180 160 140 120 100 Population (mm) 80 60 40 20 Age Demographics Developed Nations 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95 100 Age Russia '04 China '00 France/UK '04 US '04 Source: UN Website

  5. 180 160 140 120 100 80 Population (mm) 60 40 20 Age Demographics Developed nations are “older” 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95 100 Age Developed Developing Source: UN Website

  6. Geopolitical Shift Young Old 407 Q Source: National Petroleum Council, 2007

  7. Observations • Demographics • Cycles • Balance and Bridges

  8. $100.00 $90.00 $80.00 $70.00 $60.00 Oil Price ($2007) $50.00 $40.00 $30.00 $20.00 $10.00 $0.00 World Oil Production (Thousand Barrels) Oil Price Average in $/bbl Inflation Adjusted 2007 Global Oil 35,000,000 (mbo) 30,000,000 25,000,000 20,000,000 15,000,000 Global Annual Production 10,000,000 5,000,000 0 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 Source: 1980-2007 Energy Information Administration As of January 2008 (www.eia.doe.gov/pub/international/iealf/crudeoilreserves.xls ), 1950-1980 OPEC (http://www.opec.org/library/)

  9. Crude Oil Domestic Wellhead Price ($2000) 100.00 90.00 80.00 70.00 60.00 50.00 Oil Domestic Wellhead Price ($2007) 40.00 30.00 20.00 1970 1975 1980 1985 1990 1995 2000 2005 10.00 0.00 Oil and Economy GDP Growth (Percentage points at annual rates) 10 8 6 4 GDP Growth (% points at annual rates) 2 0 Year -2 -4 Data: BP, EIA February 2007.US Department of Commerce

  10. Energy-Economy Cycles • Global oil demand/supply (D/S) is tight • Currencies are strong or weak • Speculators hedge against currencies by buying oil • Tight D/S and speculation drive up the price of oil • High price dampens energy demand • Lower D/S, excess production capacity (short term), weak economy drive oil price down • Global interdependence impacts global markets • Lower oil prices help stabilize the economy • and…

  11. Oil Price 2000 $ $60.00 $50.00 $40.00 $30.00 $20.00 $10.00 $0.00 Department of Geosciences,University of Texas Total Masters

  12. Oil Price 2000 $ $60.00 $50.00 $40.00 $30.00 $20.00 $10.00 $0.00 Department of Geosciences,University of Texas Total Ph.D.s

  13. 1.7 mm 100.00 90.00 30 80.00 1.1 mm 70.00 US Undergrad Enrollments in Geoscience (1000) 20 60.00 50.00 Oil Domestic Wellhead Price ($2007) 10 40.00 30.00 0.7 mm 20.00 1970 1975 1980 1985 1990 1995 2000 2005 10.00 0.00 Employees Large O&G Co US Upstream R&D 2004 Dollars CERA Compound Cycles Year Data: BP, EIA February 2007.US Department of Commerce

  14. Observations • Demographics • Cycles • Balance and Bridges

  15. HOW EASY IS IT TO MANAGE DUAL CAREERS IN THE OIL AND GAS INDUSTRY? Percent Age group 0 20 40 60 80 100 18-24 25-34 35-44 No problems at all 45-54 55+ All 18-24 25-34 Difficult but possible 35-44 45-54 55+ All 18-24 25-34 Very difficult or impossible 35-44 45-54 55+ All From Chadud, N., Tealdi, L., Howe, S., and Sprunt, E., 2007, How companies attract and retain talented engineers whose spouses have careers, in Talent & Technology, v. 1, no. 4, p. 5–10. QAd6422

  16. Dual Career Challenges • Goal: Reverse the trend of decreasing women in energy sciences throughout a full career • Maintaining a science edge in the “part time” years • Separating what we want to do from what we are willing to do • Reverse discrimination • Precedent setting and consistency of policies • Avoiding flexibility dysfunction

  17. Industry, Government, Academe Bridge • Complex global issues pose technological and social challenges requiring an integrated approach • Each sector has different time scales for decision making, and are motivated by different opportunities • Science, policy and commercialization are critical partners for the future • Bridge across the canyons and peaks

  18. Summary: It Takes a Team! Policy Maker! Industry! Student!

  19. Summary Concepts • Fossil fuels are essential for many decades • Price volatility is likely; must enjoy change • Global demographics are evolving • Talent is the fundamental priority Government/industry/academe must work together to bridge across the cycles in order to create a stable environment that attracts and retains the best talent in the world.

  20. A career in the energy industry is exciting, challenging, rewarding and at times terrifying! You cannot find a more meaningful issue on which to work for the coming century than global energy. Period. Get after it! http://www.great-lakes.net/teach/history/macbridge/mac_2.html

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