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A Recruiter’s Views From the Oil Patch

How COVID-19 and the oil price drop is affecting recruitment in the oil and gas industry.


Just as the oil and gas industry was starting to rebuild technical capabilities, following the oil price crash of late 2014, with discretionary drilling and exploration both back on the agenda, we may be about to find ourselves losing some of the forward momentum which has been built up during the past 18 months. 

It is difficult to apportion how much of the current scenario is on account of COVID-19 and how much it is driven by the low oil price. In other times we would be talking ad nauseum about the oil price and what it may mean; at present it is barely getting a look in during conversations as COVID-19 is requiring immediate focus and response. However, the recent fall in oil price is certainly being discussed behind closed doors and, once again, poses a very real threat to our industry.  

What we have seen so far:

  • Contractor layoffs. We have seen a substantial decline in the number of contractors we have out working (almost a 60% reduction) as companies postpone projects, reduce spend, and manage their cash flow.

  • Roles put on hold. Several positions that were active, and in some cases advanced in the selection process, have been put on hold or cancelled.

  • Some roles still being hired. Some projects are committed and still require staffing. We are still progressing the recruitment process for a number of such roles.

  • International workers grounded. Oil and gas workers who work on a rotational basis in other countries are currently grounded due to travel restrictions.

  • Shortage of workers. Some companies face staffing challenges, i.e., rigs that rely on an internationally mobile workforce.

What do we think this will mean?

  • Possible redundancies. While most companies will be reticent to make redundancies, this may become necessary if the current market conditions endure.

  • A drop then an increase in contract workforce. Last time around, the day-rate contractors were among the first to get cut, but opportunities for engagement increased as peaks of work arose that could not be delivered by a leaner staff workforce (following cuts).

  • Reduced opportunity to work internationally. If redundancies occur, there may be a knock-on effect whereby employers’ ability to issue employment visas is reduced or removed in order to ensure that job opportunities are offered to local candidates first and domestic workforces are rebuilt first.

  • Reduced drilling. In the low oil price environment we would expect to see discretionary drilling minimized and commitments pushed back where possible.

  • Reduced exploration. This one is heartbreaking; it was just starting to come back.

  • Increased mergers and acquisitions (M&A). While we saw more speculation than action in the M&A space following the oil price crash in late 2014, with sellers and buyers sometimes failing to agree on a price, this current scenario may offer parties the opportunity to revisit assets that they passed on last time around and potentially renegotiate a favorable outcome.

David Styles is the managing director of Patch Personnel. The article was originally published on his LinkedIn page.