Oil and Gas Industry: Good Advice from WEN Speaker
By Carolina Quintana Sanchez —Earlier this month, CSB and UST students joined Women’s Energy Network (WEN) guest speaker, Jeannie Gardner, who has more than 20 years of experience in the Oil and Gas Industry. She provided an insightful view on low oil prices, its impact on the energy industry, and gave practical advice to the audience.
DROP IN OIL PRICES
According to Ms. Gardner, the forces of rising supply and weaker demand can easily explain this environment of low oil prices. In the past decade, U.S. and Canada oil companies were forced to implement innovative techniques (such as fracking and horizontal drilling) due to high market prices, while civil conflicts in countries such as Iraq and Libya led to low production levels. Since 2008, these practices successfully added 4 million extra barrels per day; a significant amount if we take into account that daily global production of crude oil is just 75 million barrels. By mid 2014, those conflicts had subsided (adding an estimate of 3 million bbls/day) and demand in Asia and the EU began to decrease as the overall economy slowed down in addition to more fuel -efficient cars on the market. As prices dropped, everyone was waiting to see if the OPEC or Saudi Arabia and Iran would cut production to push prices back up. Of course these countries didn’t want to give up their market share and refused to cut production, even though they need higher prices to balance their national budgets. With more crude oil available, inventories have filled up pushing prices down even further.
IMPACT
How has the low oil price impacted the energy industry and how are companies responding? According to Ms. Gardner, $50 dollar oil price has placed $150 billion of upstream investments at risk; current projects are no longer valid, so many planned projects are not longer viable; market demand for assets, services, and talent has slackened; and mergers such as Halliburton-Baker Hughes will only intensify. Companies such as Shell Downstream Inc., where Ms. Gardner works as a Global Process Lead in Shell’s Trading & Supply, have stopped projects, reorganized internally to get the most out of their talent, sold uncompetitive assets, leveraged technology where applicable; and have increased the importance of managing costs.
SEEKING EMPLOYMENT IN THE INDUSTRY
With such an uncertain scenario, Ms. Gardner emphasized the importance of participating in organizations such as WEN from all students. These types of bodies are fundamental to the financial success of energy companies, they are able to identify and build a sustainable pipeline of talent, and move beyond learning by putting necessary skills into practice. So what do you need to do as a student looking to work in Oil & Gas? First of all, build your network, and cultivate your relationships! As a recruiter for Shell, she has seen that people get jobs mainly because they have a relationship with someone at the company. Ms. Gardner’s most valuable piece of advice was to effectively communicate the value that you will bring to the company and not vice versa. “Use powerful language when communicating; don’t use passive but active language.” For example: instead of saying “I completed the project 3 months ahead of schedule”; say “I completed the project 3 months ahead of schedule, contributing an additional $50K to revenues.” Last but not least, students most understand the company’s goals, challenges and what’s important to them.
Carolina Sanchez
UST – MBA candidate – Cameron School of Business