This article is co-authored by:
- Shannon Roberts, Principal, Climate Change and Sustainability Services, Ernst & Young LLP
- Charlotte Pugh, Senior Manager, Climate Change and Sustainability Services, Ernst & Young LLP
As production capacity in the oil and gas (O&G) industry recovers toward pre-pandemic levels, there are significant concerns about the workforce and its ability to operate safely and reliably.
When the pandemic struck, production was paused and many workers — operators, servicers and contractors — fled the industry for good. As production resumes, O&G companies are struggling to find qualified and experienced operators who can fill vacancies to safely and efficiently operate rigs.
It’s a problem that is having tragic consequences. The International Association of Oil and Gas Producers (IOGP) found that the number of fatalities in the industry increased by more than 40% from 2020 to 2021. The 20 fatalities occurred in 15 separate incidents, according to IOGP’s 2021 safety report.¹ This inability to provide a safe work environment is constraining the industry’s ability to expand production, as operators can’t upskill their workforce quickly enough to support an increased workload and, ultimately, meet stakeholder demand.
So what can the industry do to both bolster and protect its workforce?
Workforce falling short on numbers, experience
The industry’s personnel problem is not just about numbers. When so many workers were forced out in 2020, valuable experience and wisdom was lost that enabled companies to safely and efficiently meet a variety of work challenges. Today, leaders need to reprioritize a safety culture that protects the wellbeing of their employees and enables a workforce with the skills and training to overcome these challenges. This starts by implementing sound safety practices and controls to reduce the risk of workplace injuries and catastrophic accidents, on top of the urgent need for reinforcing, and in some cases, providing new courses on safety fundamentals. Controls can range from integrated environment, health and safety (EHS) management systems, such as ISO 45001, risk assessments, and engineering services that protect workers from hazards and help quantify levels of risk, to improved visibility and targeted safety sweeps to assess the workplace in real time. The development and implementation of sustainable controls are necessary to verify that safety performance remains high. To meet these challenges, O&G companies need to drive safety into all aspects of their operations, offer tools and resources to support this effort and measure progress.
Prior to the pandemic, the O&G sector was already struggling with significant labor gaps as experienced workers retired and fewer workers joined a volatile industry facing perception issues. However, the longevity of the industry, and the workforce that supports it, can be bolstered by digital transformation and tools. Technology services, such as dedicated EHS management system software and metrics databases, particularly when paired with wearables, can be leveraged to provide actionable data around risk, injuries and the effectiveness of corrective actions.Companies across the industry are rapidly deploying remote operations and cloud-based infrastructure to improve drilling efficiencies and reduce the number of required rig workers. But operators will need to focus on strengthening the safety culture and giving workers the authority to stop work without fear of retribution when unsafe conditions are present. To enable this, teams need to be equipped with the right skills, data and knowledge to identify hazards and be safe whether at the rig site or in the office. Providing workers with the controls, tools and skills necessary to de-risk the process will, in turn, instill confidence both within the field and management teams.
For example, training records can now be digitally stored in cloud-based applications and accessed by supervisors in the field directly from QR codes affixed to workers’ personal protective equipment (PPE). Enablon Go, a smart device application, allows workers to report and access information from anywhere with an internet connection, further enhancing communication and potentially making risk assessments and job safety aids available in real time.
There is considerable work that needs to be done to make this happen. In the 2020 EY Oil and Gas Digital Transformation and the Workforce Survey, nearly 90% of respondents said the ability to adopt digital technologies is a competitive advantage; yet fewer than half said they had an adequate supply of critical skills, such as digital literacy, data science and AI. This survey was conducted two years ago, but it is clear that this problem has yet to be addressed in a meaningful way.