Poor pay for oilfield workers leads to exodus of skilled labour and production drop
CARACAS — When Angel Fernandez, a former production engineer with Venezuela’s state- owned petroleum company, relocated to Canada’s oilsands region, it wasn’t for the weather. The draw was a paycheque that he said can stretch as much as 100 times further.
“It’s been very difficult adjusting to temperatures” that typically max out at - 10C, Fernandez said in an interview. “But for the opportunity, it’s worth it.”
Fernandez, 33, is part of a growing exodus of skilled oilfield workers from Venezuela, where real wages for engineers have fallen to the equivalent of less than $ 400 a month, about nine per cent of the global average. The world’s worst inflation, swelling crime rates and a plunging currency are prompting others to move abroad, dragging down oil production at a time when slumping crude prices threaten the country’s export revenue.
While Venezuela’s foreign affairs ministry has declined to provide emigration data, job websites show surging interest. The number of Venezuelans with active resumes on Rigzone. com, a Houston- based oil and gas research company with an employment database, jumped 22 per cent this year through October, and is up 68 per cent over 2011. Daily page views on MeQuieroIr. com, which helps Venezuelans looking to emigrate, reached 180,000 to 200,000 in September and October, compared with an average of 60,000 for the past four years.
“This is the highest and most prolonged traffic spike we have experienced since we launched in 2001,” MeQuieroIr. com director Esther Bermudez said in an email. Bermudez worked for seven years in Petroleos de Venezuela SA’s public affairs department in Caracas, before emigrating to Montreal in 2001.
PDVSA is pumping about 8,000 barrels per employee per day, compared to about 26,000 barrels in 2004, according to the trade group Gente del Petroleo. While Venezuelan President Nicolas Maduro has pledged to double output, few in the industry are confident this goal can be reached.
“It’s clear they don’t have the human capacity to lift output,” said Eddie Ramirez, the group’s director and a former PDVSA employee who has long criticized the government. Production peaked in 2008 at 3.2 million barrels a day, and last year slid by 11,000 barrels to 2.9 million a day. PDVSA declined to comment on turnover rates.
Real wages for engineers in Venezuela with five to six years of experience are less than $ 400 a month, based on guidelines published by Venezuela’s Engineering College. That’s about nine per cent of the global average of $ 4,333 a month, according to Hays 2013 Oil & Gas Global Salary Guide. Three years ago, Venezuela’s engineers took home about 80 per cent of the global average.
The currency has lost 85 per cent on the black market since Maduro took office in April 2013. The inflation rate, at 63 per cent, is “destroying wages,” said Jose Bodas, general secretary of the Federal Union of Venezuelan Oil Workers or FUTPV, which
There’s no oil worker in the world that makes as little as you do in Venezuela. JOSE BODAS GENERAL SECRETARY OF FEDERAL UNION OF VENEZUELAN OIL WORKERS
represents about 100,000 workers at PDVSA. “There’s no oil worker in the world that makes as little as you do in Venezuela.”
In neighbouring Colombia, engineers make more than four times more, about $ 1,650 a month. That’s drawing Venezuela’s oil workers across the border. The country issued 4,234 temporary identity cards to Venezuelans in the first half of this year. That’s 6.9 per cent more than all of last year and more than double 2012 levels, according to the Foreign Affairs Ministry. Those figures don’t identify specific occupations.
Colombia’s oil engineering council CPIP and its union USO both say the number of Venezuelans entering the industry is increasing, accounting for 70 per cent of professional licenses handed out to foreigners.
Fernandez, the former PDVSA engineer, moved last year to Grande Prairie, Alberta, where the temperature in January typically ranges from - 10C to - 21C. He earns more than $ 100,000 a year working for Encana Corp.
When he left PDVSA, his paycheque was worth about $ 1,000 a month; that’s at official exchange rates, which almost nobody gets. The real rate, the unofficial, black market exchange rate available to everyday folk, would give him about $ 42 now, according to www. dolartoday. com, a website that tracks the rate on the Colombian border.
“The major driver was economic,” he said.
For Jesus Castro, 38, crime was another reason to leave behind family and friends in Barquisimeto, western Venezuela, where he worked as a PDVSA electrical maintenance supervisor.
“I didn’t want my children to grow up like caged birds,” he said by telephone from Calgary, where he works as a project manager for utility EnMax Corp. In the past four years, he said he’s seen an influx of Venezuelans. “Friends, family, sometimes people I don’t even know personally call me asking how to fill in forms, get a visa or help to find a job.”
The wave of emigration has accelerated this year after Maduro devalued the currency in May, said Ivan Freites, a union official with FUTPV.
“We’ve seen an uptick in departures due to the additional financial pressures on workers created with devaluation,” Freites said in an interview in Caracas. An earlier exodus followed a general strike in 2002 and 2003, and about three- fourths of the estimated 20,000 people who left PDVSA then are now working in countries including Mexico, Argentina and Colombia, or in the Middle East, he said.
Datanalisis polls shows 10 per cent of the population is thinking about emigrating in the near future, more than double levels of two years ago, said Luis Vicente Leon, president of the Caracas- based research company.