Energising millennials

By: Ben Oudman, director and regional manager, Region Continental Europe, Middle East, India and Africa, DNV GL – Oil & Gas

As the world pivots towards a lower carbon energy future, the oil and gas industry is looking to upskill and welcome a new generation of leaders, engineers and innovators to reshape and reinvigorate the sector.

In the short-term however, concerns over skills shortages and the ageing workforce impacting company prospects have risen in the Middle East and North Africa (MENA) according to new research published by DNV GL. A fifth of senior oil and gas professionals (20 per cent) cited this issue as one of the top five barriers to growth – up from 15 per cent last year. Conversely, such worries have lessened globally, down six percentage points to 15 per cent.

New Directions, Complex Choices: The outlook for the oil and gas industry in 2020 is based on a global survey of more than 1,000 people, the largest international sample in the report’s history. Now in its 10th year, the report assesses industry sentiment, confidence, and priorities, and provides expert analysis of the key challenges and opportunities for the year ahead.

An evolving workforce

Predictions and perspectives on recruitment and the needs of those considering a career in the oil and gas industry are investigated for the first time in the annual outlook report.

Unlike those questioned globally, a third of MENA respondents (33 per cent) expect their business to increase headcount for the year ahead. This opinion is comparatively unchanged from 2019 (32 per cent). In contrast, fewer people globally believe that headcount will rise, down from 34 per cent last year to 28 per cent.

The report asserts that staffing challenges now, and in the future, may be further compounded by the depth and pace of change in some parts of the sector. The impact of decarbonisation initiatives and the demands of digitalising operations are key examples, much discussed and debated by industry leaders. The report asserts that younger professionals and new entrants into the industry will likely spend much of their careers steering their organisations through this transformation.

Galvanising decarbonisation

Notably, DNV GL’s Industry Outlook survey revealed that more than half of respondents in the MENA region (55 per cent) expect their organisation to actively adapt to a less carbon-intensive energy mix in the year ahead. For instance, the study found there is a greater focus on maintaining or increasing investment in photovoltaic (PV) solar (71 per cent) and solar thermal (57 per cent) in 2020. The need for accelerated change is the most pertinent in MENA at 71 per cent compared to 25 per cent in North America.

It is anticipated that a developing renewable industry in MENA can also provide much needed diversification of local employment opportunities, viewed favourably by local governments. DNV GL is currently supporting several renewable energy projects in wind, solar and energy storage throughout the region.

While skills and experience from oil and gas are easily transferrable to alternative energy sources, operational, commercial and new practical know-how is required. Though the abilities of risk management professionals are most in demand by a quarter of global respondents (25 per cent), 10 per cent need environmental specialists.

Beyond the dawn of digitalisation

To support sustainability and improve productivity, the development and deployment of digital tools is rapidly establishing a foothold. Within 12 months, there has been an unprecedented jump in the number of those who view digitalisation as a priority, up from a third (34 per cent) in 2019 to more than half (54 per cent). Almost all respondents globally (92 per cent) expect to increase or maintain spending in this area in the year ahead.

A huge majority of MENA respondents (96 per cent versus 92 per cent globally) expect their organisation to increase or maintain spending on digitalisation in 2020. In particular, 63 per cent expect investment in cyber security to increase, up from 38 per cent a year ago.

Cyber security concerns have risen significantly in MENA with a much larger slice of spending forecast for the year ahead – more so than globally. Safely controlling and averting cyber incidents is a high priority for 35 per cent of those questioned, nearly quadrupling last year’s figure of 9 per cent. Embedding procedures and processes to counter the potential impact of an attack requires specific skills. No wonder that nearly a fifth (19 per cent) of those questioned need artificial intelligence and data specialists to join their organisation. This necessity for digital expertise is significantly higher globally at 28 per cent.

Enticing the next generation of decision-makers, engineers and innovators to lead and transform the sector is critical and complex. Just under half of MENA respondents (47 per cent) believe the industry as a whole is struggling to attract younger employees.

In summary, the survey revealed that those who believe their organisation is an industry leader in digitalisation are more confident in their company’s prospects, more resilient to volatility in the oil price, and are pursuing greater investment in the energy transition.