By Bill Price
As we arrive at this third installment of our three-part series covering the human resources function as it relates to the three main stages of oil and gas production (namely, prospecting, drilling, and completion/collection of a well), we find ourselves dealing with the final stage, completion/collection. And for our purposes here, we’ll be focusing on the personnel are involved in that final step of extracting oil and gas out of the underground formation.
In the business of petroleum production, “completion” is the process of making a well ready for production of oil or gas. This essentially involves preparing the bottom of the hole to the necessary specifications directed by the engineers, then running in the production tubing and its associated down hole tools. These are likely special devices for perforating holes in the rock and technology for stimulating the oil flow—a process more commonly known as frac’ing a well. Typically, the process of cementing a casing liner and a steel production casing is also included. A pump jack and/or well head is placed on top of the completed well. Finally, flow lines for conveying oil to storage tanks are put in place—or gas lines, if natural gas is involved, to carry the gas to collection points. A good well should produce for 10 to 30 years, although some maintenance is required. Gas is normally transported by underground gas lines, while oil may be transported by pipeline or temporally stored in tanks until a truck arrives. Someone must regularly check on the well condition and answer calls for problems on site. The well will eventually require major improvement, or a workover, every few years to ensure production is at the maximum level.
These well completion steps all involve a variety of support companies with highly specialized workers. They will include positions that employ entry level workers, middle experience technicians, and supervisors. I remind you again that the overall process includes an incredible number of additional support people not located at the well site to make this process possible. A great YouTube video clip provided by the American Petroleum Institute (API) explains the well completion process for a well using fracturing technology. It is at http://www.api.org/oil-and-natural-gas-overview/exploration-and-production/hydraulic-fracturing/video_tour_of_operations.
For most operations in the Permian Basin, these processes noted above are accomplished by small business. This was all-too-apparent at the recent Midland Energy Expo as well as the Odessa PBIOS, which features hundreds of highly focused firms with experienced professionals. Each of these firms will hire a large number of entry level positions, which offers young people an opportunity to learn a high paying job in the industry. Many of these new entrants have some basic transferable skills acquired earlier—perhaps experience on an oil rig, or as a driver, or assembling parts in one of the many shops in the Basin.
We mostly see men seeking these positions described above and I suspect that’s because of the heavy labor involved in most entry level positions. On the other hand, there is a demand for either male or female in many positions such as drivers, schedulers, and employees in the parts houses. Other positions requiring formal education with a high proportion of female workers include accounting, engineering, analysts, and landmen.
When talking to young business students at the University of Texas of Permian Basin, I am overwhelmed by the proportion of them who are interested in entering the energy business by their senior year. It appears that half of the working students (and many do work) have some experience in the energy business already. This provides them with some understanding of basic concepts of oil and gas production. These business students are trying to move away from entry level positions with long hours and move toward what I would call a professional position. At the lower end this could be a field technician or field supervisor. Many find they are qualified for sales in technical areas. For example I ran across a recent graduate who was selling Measurement While Drilling (MWD) equipment. He had a couple of summer jobs in the industry but topped off his education with a business MBA degree. The company provided him with specialized training and he now has a clean job with an excellent income. I am aware of another young man who began in ranching, went to water truck driving, then to assembling perforating tools, and finally to a field rep position. This 25-year-old is now going to Midland Advanced Technology Center (ATC) for additional training before returning to the industry. These routes of progression are fairly common ways to enter the energy business.
I highly encourage managers and owners of small businesses to pay attention to your employees by noting which ones are interested in improving their skills. In particular, be aware that employees who are attending community college or universities part-time are your future managers. Remember, one of the best sources of competitive edge is a highly skilled and knowledgeable work force.
Dr. Bill Price is Dean of the College of Business and Engineering and Professor of Management at The University of Texas of the Permian Basin. He has previously held several positions in human resource management and other leadership roles. He has taught various courses in human resources and has published a number of articles in the areas of human resource management and strategy. He can be reached at email@example.com.