From Discovery to Production—The Challenges of
Execution
Oil & Money 2013, London, UK
October 2, 2013

This document conta...
The industry has reversed the declining trend in oil discoveries
Five-year averages of oil volumes discovered and crude oi...
More companies manage megabudgets and project delays are increasing
E&P companies spending >$5Bn (2011 US$) capex per year...
Lack of internal capabilities is the main project challenge
Capital project challenges by type
External
Shareholders, 14%
...
The industry faces a shortage of experienced professionals
PTPs per age bracket on a global basis

Global number of PTPs (...
It matters as production is correlated with talent availability
Total number of technical resources vs. operated productio...
Sub-Saharan Africa: the challenge of education
Ptps required to support the production
growth in Africa

Necessary amount ...
Education and training capacity should meet employment potential
Job creation in a sub-Saharan country

Education and trai...
From Discovery to Production—The Challenges of
Execution
Oil & Money 2013, London, UK
October 2, 2013
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Schlumberger Business Consulting's President, Antoine Rostand shared his views at Oil & Money 2013

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Schlumberger Business Consulting's president, Antoine Rostand shared his views on the challenges of execution from discovery to production within the energy industry and the ability to be able to transform reserves into production.

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Schlumberger Business Consulting's President, Antoine Rostand shared his views at Oil & Money 2013

  1. 1. From Discovery to Production—The Challenges of Execution Oil & Money 2013, London, UK October 2, 2013 This document contains “forward-looking statements”- that is, statements related to future, not past, events. In this context, forward-looking statements often address our expectation of future conditions including, without limitation, economic conditions, energy demand, energy supply and capability requirements. Forward-looking statements by their nature address matters that are, to different degrees, uncertain. These uncertainties may cause our actual future results to be materially different than those expressed in our forward-looking statements. We do not undertake to update our forward-looking statements.
  2. 2. The industry has reversed the declining trend in oil discoveries Five-year averages of oil volumes discovered and crude oil prices -6% 140 +3% 50 120 Billion Bbl 40 100 -8% 30 80 +6% 60 20 40 20 10 1965 US$ (2011) 60 1970 1975 1980 Onshore and SW Source: IHS Edin; Rystad Energy; BP Statistical Review; SBC analysis 1985 1990 DW and Ultra DW 1995 2000 2005 0 2010 Crude oil prices © 2013 Schlumberger Business Consulting. All Rights Reserved. 2
  3. 3. More companies manage megabudgets and project delays are increasing E&P companies spending >$5Bn (2011 US$) capex per year and megaproject* delays 40 3 35 2.5 17 25 16 17 18 20 13 15 7 0 6 16 4 5 5 2 3 4 7 5 2001 1 5 2000 5 4 3 2 1.5 9 10 15 7 7 7 7 6 9 11 13 Years of Delay Number of Companies 30 1 0.5 7 7 7 7 7 0 2002 Majors 2003 2004 2005 Independents with budget >$1bn (real 2011$) Source: IHS Upstream database, February 2012; Rystad Energy 2006 2007 NOCs 2008 2009 2010 2011 2012 Average Delay * Projects © 2013 Schlumberger Business Consulting. All Rights Reserved. 3
  4. 4. Lack of internal capabilities is the main project challenge Capital project challenges by type External Shareholders, 14% Project Teams & Skills, 26% Technical Challenges, 21% > 50% of the issues are internal to the Organizations Governance, 18% Contracting & Procurement, 12% Project Management Processes, 9% Source: SBC Capital Projects Forum © 2013 Schlumberger Business Consulting. All Rights Reserved. 4
  5. 5. The industry faces a shortage of experienced professionals PTPs per age bracket on a global basis Global number of PTPs (2011-2025) 25% 2016: lowest number of experienced PTPs Percentage of PTPs 20% 15% 10% 5% 2022: level of experienced PTPs of 2011 2005 2016 Note: PTPs stands for Petrotechnical Professionals (geoscientists and petroleum engineers). Source: SBC O&G HR Benchmark 2006-2012, World Energy Outlook 2012 Experienced PTPs 2025 2020 2015 2011 0% Unexperienced PTPs Inexperienced PTPs © 2013 Schlumberger Business Consulting. All Rights Reserved. 5
  6. 6. It matters as production is correlated with talent availability Total number of technical resources vs. operated production Number of PTPs R² = 0.9 R² = 0.9 Operated production Kboe/d Low production growth1 High production growth 1Low production growth: companies with less than 2% CAGR of operated production during the last 4 years. Note: For confidentiality reasons, company data have been replaced by illustrative data points Source: SBC O&G HR Benchmark 2012 © 2013 Schlumberger Business Consulting. All Rights Reserved. 6
  7. 7. Sub-Saharan Africa: the challenge of education Ptps required to support the production growth in Africa Necessary amount of enrolled students to supply PTP graduates1 11,000 239 Current supply 4,400 3,100 Thousand People Number of PTPs Additional required 4,300 8,000 ~700 more PTPs per year until 2020 141 87 1.2 0.7 0.5 2011 PTPs PTPs leaving Supply of the industry Graduates current students progression rates Source: SBC O&G HR Benchmark 2012, UNESCO GAP 2020 required PTPs Yearly amount of graduates 10 6 4 Tertiary 51 98 36 Secondary Primary 1 At © 2013 Schlumberger Business Consulting. All Rights Reserved. 7
  8. 8. Education and training capacity should meet employment potential Job creation in a sub-Saharan country Education and training timeline Years Craftsmen Cumulative number of people (FTE) Welders pipe Civil Craftsmen Operators Machine Operator Driver heavy duty Technicians Mechanical Engineers Mechanical Electrical 2015 Operators Source: SBC analysis 2020 Craftsmen 2025 Technicians 2030 Engineers Today Formal education time when needs to be supported Lead time to certify/train to work in industry Time to start recruitment for training/certification Time to start work © 2013 Schlumberger Business Consulting. All Rights Reserved. 8
  9. 9. From Discovery to Production—The Challenges of Execution Oil & Money 2013, London, UK October 2, 2013

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