Oilpatch jobs lost to automation

A LEANER OILPATCH EMERGES FROM THE DOWNTURN AS TECHNOLOGY ADVANCES REPLACE JOBS

Tens of thousands of oil and gas workers laid off during the downturn have been waiting for the patch to get back on its feet, but many of the jobs could be gone for good.

A rapid change in technology is playing out across the industry, after plummeting crude prices that began in 2015 forced companies to cut jobs and other costs wherever they could over the past two years.

Now, with oil holding steady above US$50 a barrel since December after having bottomed out to about $26 in early 2016, energy analysts say the growth of automation and other labour-saving efficiencies could hold back many jobs from returning with the economic recovery.

Take shale drilling, where just a few years ago you could find 30 rig hands operating diesel pumps, using headsets to synchronize the throttle and pressure needed to break apart the rock formations and free the trapped crude.

Today, that job can be done by two people sitting inside a control van, monitoring the automated, electrified systems, said Mark Salkeld, head of the Petroleum Services Association of Canada.

“Now on a drill rig you’ve got a driller sitting in a cyber chair, with dual joysticks, touch screens, everything instrumented. He can control the whole rig, he can see it all.”

Companies are relying more on machine learning to crunch the bewildering array of data from the field, looking for ways to improve production and lower costs, said Warren Gieck, a production optimization leader at General Electric’s innovation centre in Calgary.

“As the market is settling out and people are looking at expanding, they’re looking at expanding their projects, but not the number of people that are running them,” he said.

“They’re trying to do a lot more with a lot less,” he noted. “The personnel that are left are just overloaded and need additional tools.”

Gieck said that downturn has also accelerated the hunt for optimization because companies can’t afford to just drill extra wells like they could in the past.

The streamlined operations can be seen at Cenovus Energy, where the downturn spurred a major restructuring, says Drew Zieglgansberger, executive vicepresident of oilsands manufacturing.

“We have been extremely focused over the last two years on efficiency and reducing our cost structures,” he said by email.

The efforts have resulted in faster drilling, fewer well pads and other improvements that have cut non-fuel operating costs by 30 per cent.