Executive viewpoint

In 1972, the Club of Rome highlighted in The Limits to Growth report that oil reserves, as known at that time, represented a maximum of 30 years of global consumption. That assessment was reached, of course, without knowing about the evolution of exploration techniques, which led to new, and sometimes unexpected, discoveries; and new production technologies that allowed for better oil recovery and the development of frontier fields. Forty years later, proven oil reserves have doubled, despite the ever-growing demand for hydrocarbons, which still supply more than 50% of the energy consumed by the world’s 7 billion inhabitants.

The era of easy oil is, however, over. Our industry is facing new challenges. I would like to elaborate on three of the issues, which are the most critical for us: increasing project complexity; an essential focus on quality, health, safety and environment (QHSE); and the importance of people.

New frontiers require investment but first and foremost, they require technical innovation. Following the recent pre-salt discoveries, the southeastern coast of Brazil poses numerous technological challenges, such as drilling a 2-km salt layer to reach reservoirs; average 2,300-m water depth; and the high H2S and CO2 content. Such complexity requires R&D efforts, not only from Petrobras, and other oil and gas companies, but also from the whole chain of service providers.

Going beyond what has been done before also requires innovations in project management. Our industry is experiencing a major breakthrough with the first Floating LNG plant (FLNG) coming to life. The Shell Prelude unit, anchored 200 km offshore Australia, and measuring 488 m in length, will be the world’s largest offshore floating installation. An engineer’s dream come true! To execute this vision, an innovative way of working had to first be defined, with 6,000 people joining forces in Paris, Kuala Lumpur, Chennai (India) and Geoje (South Korea), and successfully mobilizing the know-how, and resources, of subsea technology, floaters and the LNG process. Petronas has also sanctioned its first FLNG.

Innovating for a safer, cleaner energy industry. To conquer new markets and guarantee success in the oil and gas industry, QHSE must remain a priority, in all projects, and guide our decisions.

In our day-to-day activity, what makes the difference between good and bad HSE performance, on two similar projects, can be summarized in three ideas: leadership and accountability from everyone, alignment between the different stakeholders; and trust in the systems in place. Quality, as a way to prevent incidents, and a commitment to “do it right” the first time, is also a key priority.

In the event of dramatic accidents, industry has no choice but to respond adequately to provide solutions. This has been the case with the Macondo tragedy in the Gulf of Mexico, which served as a sharp reminder of the importance of not only spill prevention, but also of having systems that are ready to mitigate the impact of any spill. Soon after the Macondo spill, international operators, led by Exxon Mobil, joined together to create the Marine Well Containment Company and developed a system to fully contain an oil spill, in the case of a subsea well incident. This project exemplifies what can be achieved when stakeholders get together and come up with an innovative solution that takes security and the protection of the environment further.

Keeping people at the center of our industry. In our industry, we all can have a good idea, yet nothing would be possible without the commitment, and passion, of our teams, engineers and project managers. It is our collective duty to manage human resources responsibly and develop the potential of our people.

The oil and gas industry should avoid the “stop and go” attitude, which is detrimental to our image. It is essential that we continue to hire university graduates, while also capitalizing on the knowledge of senior employees, to avoid future generation gaps and maintain credibility.

Investment in the development of competencies, and lessons learned, is also paramount. We should keep in mind that building critical competencies, to manage complex projects, for example, takes time. It can take between six months and a year for a process engineer to build critical competencies, and up to 15 years for a manager of a large-sized project.

Last, as the oil and gas market is shifting south and east, our workforce should also reflect this transition. Increasing the national content of projects through on-site employment, skills transfer and the use of local suppliers is a good way for the service industry to mirror its clients and facilitate a better knowledge of the field. It is also a key success factor to establish a sustainable, and responsible, presence in the countries where we work.

The oil and gas industry has achieved great milestones, and its adventure is far from over. Global energy demand is rising, and operators need to invest, over the long term, to compensate for the depletion of their fields. It is a role we embrace at Technip, to be alongside our clients, to help them make their projects a reality. Innovation and technology are two of the pillars that have allowed us to become a leader, from the deepest subsea oil and gas developments, to the largest, and most complex, offshore and onshore infrastructures. We are proud of this strength, which also contributes strongly to the fulfillment of our vision: meeting the world’s energy challenges.