Energy industry’s roughnecks go digital
Jobs evolve in oil and gas industry as technology takes a key role
Scrum master. Data scientist. Cloud architect.
Jobs in the oil and natural gas industry are changing as technology plays an ever larger role in extracting fossil fuels beneath the ground and under the sea. A younger, more diverse class of tech workers holding these and other titles, such as big data engineer or user experience designer, is increasingly replacing roughnecks, roustabouts and other blue-collar workers who toil under the hot Texas sun or on platforms in the Gulf of Mexico.
Energy companies, fighting to stay profitable with oil prices stuck in the $50 to $60 a barrel range, are making a major push to digitize and automate operations, allowing drilling in West Texas or in the middle of the ocean to be operated and monitored from control rooms in Houston. That push is driving the growth of six-figure tech jobs that prize skills such as coding, design, data analysis and computer system architecture over physical prowess.
While statewide employment in the oil and natural gas industry is down by 3 percent compared with a year ago, tech jobs in the sector appear to be growing, especially in Houston, where nearly two-thirds of the estimated
228,000 tech jobs in the region are outside of traditional technology companies such as Google, Amazon and Dell.
“There’s a misnomer that energy companies and pipeline companies are not technology companies,” said Al Monaco, CEO of the pipeline company Enbridge. “Nothing could be further from the truth. In fact, industrial applications like ours are a treasure trove of opportunity.”
Enbridge, a Canadian pipeline company with a major presence in Houston, is tapping into tech talent to improve its operations and profits. Enbridge opened a technology and innovation lab at its Calgary headquarters in January and followed that with the opening of a second tech lab in Houston in April. The company plans to open a third in Edmonton, Alberta.
The company’s Houston tech lab is part of a larger industry trend. The energy industry was initially slow to embrace digital technology, but companies have accelerated their efforts in recent years. Companies such as the European oil major Royal Dutch Shell, the international oil field services company Schlumberger and the French energy firm Engie have also opened tech labs in the Houston area.
Houston oil field services company Baker Hughes recently signed a deal to form a digital alliance with Silicon
Valley artificial intelligence company C3.ai and tech giant Microsoft to boost the use of artificial intelligence in the industry.
Baker Hughes also is tapping into younger talent, adopting elements of tech culture at its Energy Innovation Center in Oklahoma City, where customers come with problems from the field and leave with tangible solutions. Similar to the reality TV show “Shark Tank,” where entrepreneurs pitch their business ideas to a panel of investors, employees at the Baker Hughes innovation center pitch their marketable business ideas to executives and their partners. They also participate in “innovation sprints” to develop new products in weeks or months.
“There’s strong recognition by our leadership that we need to evolve and change,” said Taylor Shinn, a Baker Hughes executive overseeing the center.
Accenture, a global consulting firm, opened its Houston Innovation Hub in February 2017 to develop software and technology for its energy clients. Successful tech labs are those that create an environment in which people from different backgrounds can put their heads together and develop ideas that change the way a company or the industry does business, said Brian Richards, the Accenture hub’s managing director.
“It’s not easy to take a data scientist, a designer and someone who’s been on a rig for 30 years and put them in a room together to create the next Google Maps,” Richards said. “But when you do it successfully, it can be extremely valuable.”
‘Super high’ demand
Workforce development experts are keeping a close eye on the oil and natural gas industry’s digital transformation. An estimated 234,000 people across Texas worked in the oil and natural gas industry in October, down about 240,000 a year earlier, according to the Texas Workforce Commission.
Statistics for the tech side of the industry are somewhat hazy because new jobs titles are being invented faster than government officials can classify them. The Computing Technology Industry Association, one of the IT industry’s top trade associations, estimates that Greater Houston has nearly 228,000 tech workers, but that figure includes job titles ranging from software developers and aerospace engineers to security system installers and cable television repair technicians.
The Greater Houston Partnership, a regional business advocacy group, estimates that two-thirds of tech jobs in region are in industries such as energy, medicine or aerospace.
“Demand is super high for tech workers,” said Josh Pherigo, the partnership’s research manager. “All the oil and gas companies are digitizing. They’re changing their business models. They all want to know how they can use data to enhance their bottom line.”
Competition for talent
The oil and natural gas industry’s digital transformation is taking place amid increased competition for top tech talent. At Enbridge, the company is drafting people from departments such as engineering, pipeline integrity, customer service and even human resources and giving them tech training.
Located on the seventh floor of Enbridge’s building in Houston’s posh Galleria district, the lab has the feel of a Silicon Valley startup. Floor-to-ceiling windows, rows of standing desks, colorful furniture, free snacks, caffeinated drinks, toys, touch-screen TVs, videoconference rooms, lounging areas and collaboration tables offer a sharp contrast to the cubicles elsewhere in the building.
Bhushan Ivaturi, the company’s senior vice president and chief information officer, said that was by design. As part of a digital strategy that he developed for the company, Ivaturi said, he wanted the labs to provide an environment in which employees drafted from different departments could come together and solve real-world problems for the company and its customers.
Employees at the Calgary and Houston labs already have developed ways to get sensor data from pipelines faster and improve flows of crude oil and natural gas. They’ve also used mountains of data generated by operations to develop better maintenance schedules and improve pipeline leak detection. And with the company branching out into new areas of business such as renewables, tech lab workers have developed ways to reposition wind turbine blades that maximize power generation.
“This is where ideas take flight and are brought to life,” Ivaturi said. “It’s not experimentation for the sake of it. It’s about applied technology and applied innovation.”
Patrick Lamasney left a midlevel management job with the travel site Expedia and moved from Seattle to become the senior scrum master at Enbridge’s Houston tech lab in August. Borrowing a term for rugby players packed closely together, Lamasney leads morning meetings known as “scrums” where lab workers huddle to talk about what they are working on and offer advice on how to solve problems.
“The opportunity to get in on the ground floor of something like this is a very rare opportunity in software development,” Lamasney said. “Usually, you get added to a project that already exists. There are very few greenfield software development projects going on, regardless of where you’re at. This is a tremendous opportunity.”
Big ideas
Companies such as Chevron and Shell, meanwhile, have invested millions of dollars into local workforce development and education programs to cultivate homegrown talent. They also are underwriting co-working spaces and startup incubators such as The Cannon near the Energy Corridor in the city’s west side and Station Houston downtown.
Station Houston CEO Gaby Rowe was tapped in October to oversee the transformation of an old Sears building just south of downtown into a nearly 300,000square foot tech hub named The Ion. The renovated building will house multiple co-working spaces, incubators and workforce development programs under a single roof. Despite being overshadowed by Austin, she said, Houston is emerging as a tech center focused on business applications and solving big, complicated problems.
“This is not the city where you come to invent a new dating app,” Rowe said. “There’s plenty of other places you can go work on that. We do big stuff. We cure cancer. We develop the artificial heart. We put men on the moon.”