2010 SBC Oil & Gas HR Benchmark survey predicts a global loss of 5,000 experienced technical staff by 2014

PARIS, FRANCE, March 29, 2011 Schlumberger Business Consulting (SBC), the management consultancy arm of Schlumberger, today released the 2010 Oil & Gas HR Benchmark study, which reveals how a big crew change is currently reshaping the global upstream industry and will lead to the loss of 5,000 experienced petrotechnical professionals (PTPs) by 2014. For the first time in its seven-year history, this annual survey measures the impact of human resource strategies on production growth.

Oil and gas industry will lose 5,000 experienced geoscientists and petroleum engineers by 2014 2011 global graduate recruitment targets are 15% up on 2009 forecasts and are stabilizing at around 9,000 petrotechnical professionals (PTPs 1) per year Asia and Russia-CIS account for more than 70% of worldwide graduate PTPs Women account for more than 40% of total PTP graduates in Asian universities, but less than 20% in North America. For exploration and production (E&P) companies, female ratios vary from 15% to 27% depending on discipline Strong correlation between the number of PTPs employed and operated production growth

Insights from this years survey are structured around PTP IntensityTM, a concept developed by SBC to show the correlation between the ratio of PTPs to operated production and production growth based on the last five years compound annual growth rate (CAGR). The 2010 survey reveals that growing companies have a higher PTP Intensity than others. A high PTP Intensity means that there are more PTPs per 1,000 barrels of oil produced than for companies with a lower PTP Intensity. Other key findings of the 2010 Oil & Gas HR Benchmark survey are: Demographics
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Big crew change

A big crew change is currently underway in the oil and gas industry. The generation of geoscientists and petroleum engineers hired before the deep recruitment cuts of the mid1980s is approaching retirement. This natural attrition will result in the industry losing 5,000

experienced PTPs by 2014. Higher graduate recruitment targets are too late to reverse this trend in the next three years.
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Demand for graduates

The survey shows demand for graduates is recovering and outpacing the pessimistic forecasts of a year ago. Recruitment targets for technical staff in 2011 are 15% higher than levels planned in 2009. National oil companies (NOCs), independents and majors all plan to intensify recruitment efforts from 2011 onwards.
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Supply of graduates

In another positive trend, universities appear on track to provide the oil and gas industry with sufficient graduates in geosciences and petroleum engineering. However supply from quality universities will remain tight. Geographically, the 2010 survey reveals that Asia and Russia/CIS account for 72% of graduates in geosciences and 79% in petroleum engineering, with more than 30% attributable to China alone. Companies will need to adapt their recruitment to the new distribution of talent worldwide.
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Female PTP ratios

Universities represent an untapped reservoir of female talent for the oil and gas industry. In Asia, more than 40% of graduates are women. However, North American universities hardly reach 20% of females among PTP graduates. Generally, the number of female PTPs in E&P companies has increased since 2006. In NOCs, female ratios have risen to 27% from 19% in the geosciences and to 17% from 15% in petroleum engineering. Independent companies show the same increasing trend with female PTPs in geosciences at 22% from 18% previously and 14% from 12% in petroleum engineering. Female ratios remain unchanged at the major companies at 17% in geosciences and 10% in petroleum engineering.
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Mid-career recruitment

Recruitment targets for PTPs in mid-career are soaring, with NOCs and majors reporting the highest rates of increase. The labor market for experienced PTPs will be tight over the next three years, resulting in the poaching of staff, salary escalation and higher attrition rates. These staffing issues will have serious consequences on projects and production capacity. Companies contributing to the 2010 survey reported that staffing issues will delay projects and may drive decision makers to take more risk. PTP Intensity This years survey demonstrates through the PTP Intensity measurement the close link between people and growth. E&P companies will need to consider this link along with other possible contributing factors such as portfolio composition, recruitment of mid-career

professionals rather than inexperienced graduates, competency development and time to autonomy. Along with the shortage of experienced PTPs in the coming years, recent trends and serious accidents will lead to higher costs and a generally higher PTP Intensity industry-wide. Deepwater projects are being subject to stricter regulations which may spread beyond deepwater operations. Technology is critical to deepwater drilling success and to the development of unconventional oil and gas resources. In this context, companies need to adapt quickly to manage their talent pools to accommodate growth and changes to the regulatory environment or risk losing their competitive advantage. The 2010 Oil & Gas HR Benchmark was compiled by the SBC Energy Institute using data from 11 NOCs, five major oil companies, 12 independents, one oil field services company and 77 universities. The contributing companies account for 30% of world oil production.

For detail documents http://www.sbc.slb.com/Our_Work/Consulting_Expertise/Organization_Talent_Management/SBC_ HR_Benchmark.aspx