‘People Deficit’ Could Impact Energy Industry by 2010

With more than 400 major oil and natural gas projects scheduled to ramp up over the next five years, the energy industry is facing a sharp “people deficit” of 10 percent to 15 percent as soon as 2010, according to an analysis by Cambridge Energy Research Associates.
Unless there is a dramatic change in the industry, the next few years will experience a greater imbalance between needed and available staff, said Pritesh Patel, study co-author and associate director of CERA’s Capital Costs Analysis Forum.
“Pressure in the industry continues to increase as companies vie for a limited pool of skilled resources, and personnel costs rise as companies recruit from each other,” he said. “We have seen projects where no one bids for the work because they don’t have adequate resources, and the quality of the engineering workforce will increasingly become an area of great concern and focus in the medium-term.”
CERA forecasts future personnel needs by estimating the total engineering and project management man-hours required for each of the more than 400 projects due to come onstream over the next five years based on reserve size, reservoir and well stream properties, location, water depth and estimated first production date.
This analysis indicates that total upstream engineering design staff-hour needs will increase to over 79.1 million by 2010 from 73.5 million in 2006, and project management requirements will rise almost 10 percent from 19.1 million staff-hours in 2006 to 21.1 million in 2010. More than 55,500 engineering personnel will be necessary to provide this volume of work in 2010.

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