I don't know what to make of it. I believe that of the oil depletion (hobbyist?) analysts here on TOD, we have people like Khebab who is a DSP engineer, and Stuart who is CompSci whiz. At least I think that's their background (I know mine is EE). So where are the Petroleum Engineers with a deep background and appreciation of oil depletion on this site? Is WestTexas a Petroleum Engineer? I remember when I was deciding on my major and ChemEng and Petroleum Engineering had the highest starting salaries. My school had the #1 ranked ChemE department as I recall, and I knew their curriculum fairly well from hanging around and tutoring with classmates.

In any case, it's kind of like if we were discussing how a microprocessor works and not having any digital logic design engineers around correcting us. You would think that more people that have devoted their careers to a narrow topic such as Petroleum Engineering would flock here. Or perhaps they are sick of doing it day-in, day-out and don't have the energy to educate us newbies.

I know the Petroleum Engineers who understand depletion are out there, like this commenter named ReserveGrowthRulz over at peakoil.com. And RockDoc who is a PhD Geologist also at peakoil.com.

Or are the people going for Petroleum Engineering degrees only in it for the money? Could they care less about how the dynamics of oil consumption plays out as long as they get a paycheck? I happened to go for an advanced degree and have an interest in challenging research topics. It boggles my mind sometimes how us "amateurs" do a better job of at least exercising our brains than the professionals out there.

I hope I don't offend anyone too much; remember my analogy to other technical areas where you can get creamed by not knowing your academic learnin'

interesting comments - age distribution isn't something i'd though would of mattered much.
would it be possible to estimate the magnitude of this problem, and how it could impact future oil supplies (you did mention the 'now down, up later' aspect, but given that the raw numbers seem to indicate a rough balance, how large do you think the change could be?

Second, the graph is talking about changes in peak capacity of various projects, not changes in the date of arrival of that peak amount - wouldn't a lack of personal only effect the date at which the field is fully developed, and leave the peak extraction amount roughly untouched?

In either case the Hubert curve, which everyone likes to analyze oil production with, relys on the aggregate average of many oil fields, and as such the production profile from any individual field shouldn't significantly affect the nature of the curve, or predictions made from it.

Andrew
(not in any way related to the oil industry, so please correct me if i'm up the garden path here)

Hello Rembrandt,

Thxs for the stats and info in this keypost. What worries me most about this career-skills gap is future FF-worker safety. Do you know if this retirement problem is already occuring in the coal industry?

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US Coal mining deaths soared to a 10-year high in 2006, reversing an 80-year trend of steadily falling fatalities and raising safety concerns as coal production reaches record levels.
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http://www.usatoday.com/news/nation/2007-01-01-mine_x.htm

http://www.time.com/time/magazine/article/0,9171,1595235,00.html
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[Mar. 1, '07] Where The Coal Is Stained With Blood

Being a coal miner in China is one of the world's most dangerous jobs. Officially, about 5,000 of his fellow workers died in mining accidents last year. Unofficially, nobody knows how many were killed. In the space of a single week late last year, gas explosions and accidents in four mines left nearly 100 miners dead. Li Yizhong, head of the State Administration of Work Safety Supervision, described the carnage as "unprecedented" and blamed the deaths on collusion between local officials and greedy mine owners. Indeed, throughout China, the coal magnates of Shanxi are notorious for their extravagance. Chinese newspapers regularly tally the number of Hummers, Ferraris and Rolls-Royces in the otherwise impoverished province.
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I hate to think that being a soldier is a safer career choice than working in the fossil fuel industry.

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

This essay hits very close to home for me. When I left the chemical industry and came to the oil industry, I couldn't help but note that the average age seemed to be quite a bit higher. I have seen lots of age distributions, and we are going to have a tough time ahead as we lose numerous people to retirement.

This also ties in to something that I was asked about a couple of days ago, and something I am often asked about: How can you support sustainability and work for an oil company? I think my response is topical to the essay here. Here is part of what I wrote:

The situation right now is that we are very dependent upon fossil fuels. If we just stopped producing them, people would die. There would be no fuel. Your grocery store would run out of food. The cars and planes would stop. We have a society that can't go cold turkey on fossil fuels. As oil production declines, we are going to need a lot of smart people working on this problem as we attempt a difficult transition. I would also add that it isn't like my company is not involved in alternative energy efforts. hint, hint

I get e-mails every day - someone asking for advice, input, sanity checks, etc. So, I am doing what I can, and making sure my family is provided for at the same time. I believe that in a post-peak world, my current job is very stable and I will have taken care of priority #1 - my family. Personally, I feel like I have struck the right balance. There will always be those who disagree. But next time you wonder why someone would continue to help provide fossil fuels to the world, ask yourself what would happen if we all decided not to.

Any suggestions for getting in on the industry?

Do you need a graduate degree, or will an BS in a technical field do?

Any internship or introduction programs out there?

Word to the wise: Watch the Chinese.

If they made a concerted effort, they could flood the market with petrochemical specialists, geologiists and petroleum engineers.
And their interest in world petroleum is soaring.

This occrred vis a vie the computer software profession and India.
Only a few years ago, kids were told "go into software and programming, it's a killer field....big money, bright future." Only a few years later, American business began outsourcing their software work to India, which had trained in raw numbers, a larger number of programmers than the total of the U.S.
Software work can be sent electronically across the sea in seconds, meaning U.S. software engineers and programmers were competing with Indian programmers as if they were up the street.

The petroleum industry is not so easily transportable, but it is not far off. Petroleum engineers can use computers, video conferencing, and virtual modeling to do much of the spade work, and combine it with some trips to the field (an airliner can have them anywhere in hours) when they are critacally needed onsite. There will always be a need for some engineers/technicians onsite, but these will be far fewer, and will be in constrant electronic contact with a core of technical support people who can be thousands of miles away and fewer in number, backing up multiple E&P and potential drilling sites.

In other words, the oil industry will face the same changes that all industries do, and the need for manpower per barrel of oil produced or mm/btu of natural gas produced will drop like a stone. The oil and gas industry at last will come into the 20th century, here in the 21st century.

Roger Conner Jr
Remember, we are only one cubic mile from freedom

Is it possible or likely that lack of experience could lead those younger engineers into production profiles that damage the reservoirs they're working? People here talk about it qualitatively all the time, but I've never heard a quantitative assessment of how probable it is that less-experienced PE's could end up reducing their URR's significantly. Isn't the vulnerability of a field to overproduction damage dependent on its permeability?

The optimist's view :

Within five years, world peak is visible to everyone. Concern about global warming has led to international accords on carbon taxation. The pace of innovation in energy reduction and substitution is dizzying. Demand for oil is starting to slacken, even though the price is still mostly under $100 a barrel (end user prices are generally much higher due to taxation).

Oil companies raise salaries to encourage their experienced people to stay on a few more years. Oil is recognised as a sunset industry, and HR needs are projected as dwindling over the next decade.

I work for a major oilfield services company.

I think most rank-and-file professionals are caught up in the same "sunshine pump" optimism that their managers successfully feed to the public at large. Also, most oil people live in Red America, and see Peak Oil (and Climate Change) as a left-wing politically-motivated attack on them, their industry, their employer, their way of life, etc.

But there is a significant fraction who don't believe the party line from their management. But they put themselves at some career risk if they become very vocal on the issue, so that silences them.

Oh, you do need to MS in Geology, Geophysics, or Petroleum Engineering to be competitive in this industry. BS or BA degree isn't optimum. And it should be from an "oily" university... Texas A&M, University of Texas, University of Oklahoma, University of Houston, etc.

Sincerely,
Peter Wang, PG, MS
Texas Registered Professional Geophysicist

If there's a shortage of engineers they will just go for more H1Bs. I'd say avoid most engineering degrees like the plague unless you really like the work. Over half the chem engineers in the U.S. no longer work in the field.

If there are a lot of jobs available in the Petroleum Eng field the problem will self-correct in 5-10 years. If there are no jobs it won't.

Petroleum Engineer Career Path:

Step 1: Go to school and get engineering degree.

Step 2: Start at Haliburton.

Step 3: Drill more holes, get less oil.

Step 4: Get transferred from Montana to Scotland.

Step 5: Get transferred again to Haliburton's new headquarters in Dubai.

Step 6: Get sent to Iraq to supervise Iraq drilling.

Now what's wrong with this career path? Retirement isn't the only problem in the oil industry. My cousin started as a petroleum engineer. Two divorces later he now operates a couple of restaurants in Colorado.

This same profile applies, generally, to the nuclear power industry and the broader electric business also. Most of my colleagues are a bit older than I and are eager for "the letter" that lets them retire before 65 with extra benefits.

They'll go too, since our genius HR department decided to demote all the core experts from "principal" to "senior" engineer. A title is a psychic reward that costs the company little but a demotion is a slap in the face for years of faithful service.

The bright side is that college enrollments are up sharply since the kids seem quite capable of seeing the future.

Our industry organs are full of discussion on the same issues.

The near term problem is that ALL nuclear-experienced talent that want to work are working - there's no bench! Human talent is the limiting factor in the expansion of nuclear power in the US today.

Where to start? As this is my first post here after reading/lurking for a little over a year, I think I should say a small bit about me. I'm an O&G geologist working in the states (primarily Rockies lately). I've worked for both exploration companies and for service companies. At age 38, I'm also one of those people who is in the gap as described in this post by Rembrandt. Of course, I take exception to the whole article being about engineers as I'm not sure they've ever found any oil. ;) Where is the love for geologists and geophysicists?!? Presently, I'm in exploration trying to find O&G domestically.

Someone mentioned that their daughter was getting her geology degree (O&G, not environmental) and asked if that was a good profession with a future. From where I sit, I say that she has it made. This will be especially true if she gets a Master's degree (someone else mentioned this earlier, too). I can tell you that it has made a big difference for me. A BS gets you a starting job as a tech at a large company with the chance for associate geologist down the road. A BS could get you a job as a geologist starting at a small company. The salary difference between tech and geologist is not trivial. Only having a BS will be limiting for career advancement if that ever becomes important to her.

There was also some talk about Chinese professionals perhaps flooding the market. I don't completely agree with this idea. I do agree that there are many thousands more Chinese O&G professionals being trained today than American (or any other nationality for that matter). I just don't think that they will survive well outside of their system. My observations of the Chinese system in China are that the individual is not encouraged to be creative or well-rounded. People are so cheap in that country that a large field may have 900+ geologists assigned to it. A single geologist is responsible for knowing everything under the sun about gamma ray response on logs for the wells, as an example. That same person couldn't tell you much, if anything, about reservoir properties or regional geology in the field. And, they certainly are not encouraged to step outside of the box to learn it. The pecking order is hard core and people don't step out of line for fear of losing their state jobs. You can't challenge or make the boss look bad.

The contrast is that in the US, UK, Canada, and a few other non state-owned countries the geoscientists are expected to handle almost all aspects of a field within their profession. That same example of a field with 900+ Chinese geologists would have perhaps 5-10 American geologists. I'm not prepared to comment on which one is better, but I can say that it forces the independent geologists to be more well-rounded and creative.

So, take the Chinese geologist/engineer/geophysicist out of the Chinese system and he will be screwed until he fills in all of the major knowledge gaps and learns to be creative. Pick the entire Chinese system up and move it around the World...that may be a different story that could meet with success.

Finally, I agree with everything that was written in the article about the gap. As an industry, it has been on our minds a LOT. When we start hiring engineers with EE degrees and environmental geologists you know that the situation is bad. I would say that we have been doing that for the last 5 years or so. Companies are fighting for people. It takes ~10 years of work experience to make a good geoscientist, IMO.

This retiring and dying group that is going through right now won't be fully replaced and that will effect what we can do in the future. I compare it to the space race and going to the moon. we worked our butts off to get their and then literally threw it all away in the 70s when we abandon the program. Well, as we all can see, it isn't like we just turn on a switch and go back to the moon. We have to relearn and redevelop how to do it because the folks who originally did it are retired or dead. The oil industry is in about the same shape as the moon program. If we want to gear up to find and produce a lot more oil and gas, it isn't happening anytime soon (assuming that it is even possible).

There are not enough new students to replenished the senior experts. ...
So on a net basis there is no shortage of workforce in itself, but on a regional basis in North America, the North Sea, The Middle East and Russia there is. Whether there will be sufficient transfer of personnel remains to be seen in the light of cultural barriers.

Doesn’t all this signal a dying business for the importing countries, or a head-in-the-sand attitude, energy will flow and bloom, oops sorry, burn or just light up in brill’ incandescence?

I know a huge amount of young people but nary a one has ever spoken about energy (Switzerland)...not even in nuclear or hydro-electric areas. Their career choices span the arty to the whacky to the traditional (doctor, lawyer) and in Science, since 15 years, it is all chemistry, bio tech, nano tech, material science, medic this and that, mostly bugs and stupid stuff (high altitude medecine!), even old style engineering is considered uncool.

Follow da money.

Nobody studies rocks, dirt, drills, what disgusting dull subjects.

Anecotes: I have a relative (b. circa 1947) who became a petro-geologist, did very well, but around 2000 decided to quit and became...an economist! (argh)

so how many left ??

Another relative (b. 1985) went on a tour of the nuclear installations in Switz. partly with school visits; at each place efforts were made to interest the young (even glossy info packages were handed out) and it was emphasized that good career oppos were available. Takers? Don’t know, guess, none.

Imagine telling Blondista in the disco that you work for, at, X or Y nukulear installation - she’s probably think you were radioactive which as everyone knows in worse than having AIDS.

Of course the small numbers required present difficulties.

No one wants to work in the London sewers either:

Smith is 57. He’ll retire soon, along with several others in the gang in Clerkenwell. ‘I’m 40,’ Dave says, ‘and I’m the last fully trained Thames flusher. There’s no one behind me.’ Contractors might do the work, the flushers say, but they don’t have the knowledge.

:)

link

Manpower and infrastructure limitations can be resolved over time. This kind of problems ought to move the "peak" closer in time and leave spare resources for a slower decline in the post peak era.

I would be more worried about capacity limitations within nuclear industry, electrified rail, truly innovative marketing of realy new lifestyles and other industries that can replace some of the oil need.

How about the grunts-- the drillers, rig hands etc. ?
Same situation?

I think too much is being made of the bulge in the age distribution. Keep in mind that bulge was caused by massive over production of ChE's and PE's in the late 70's early 80's panic over oil price. My school went from about 80/yr to 200 then back to 80 over a decade. If salaries go nuts, watch enrollment shoot up again. We ChE's had as many job offers as interviews in the early 80's. Bidding wars on salaries as well. Then 1984 came and they showed large numbers of us the door in the oil biz anyway.

Also, just because "People in this sector normally retire at the age of 55. " doesn't mean they'll all really retire. half of my old managers are now consulting because their wives can't stand them in the house. Free travel, day rates on top of pensions etc etc. It's not like technical jobs are all that demanding physically. The peak can be spread out and the old timers used to train the influx (just like 1978--1984).

Running out of cheap oil is a real problem. There's no shortage of people smart enough to be PEs or ChEs.

Heck with a little motivation, I might pick up a calculator again. Does anyone still use Fortran (LOL).