Unconventional resources are those that were bypassed by conventional oil and gas recovery technologies for decades because they were not considered economically feasible to produce. Improvements since the early 1990s in geophysical and geochemical exploration and in drilling and completion technologies have opened up vast new resources both onshore and offshore.
Some unconventional resources are in hostile or challenging environments such as the Arctic tundra or deep water. Others are in regions that have not previously experienced extensive oil and gas development and thus lack infrastructure and community and political support. Unconventional resources encompass tight oil and gas formations, shale gas, coalbed methane, heavy oil, oil shale, deep and ultradeepwater plays, and gas hydrates. Each of these types of play requires unique strategies and expertise to develop them. Hiring geoscientists and engineers for unconventional projects has never been more daunting.
TWA’s Human Resources (HR) Discussion Team had a roundtable discussion on unconventional resources, HR requirements, and career development strategy with two experts in unconventional resources development and resourcing—Mike Maneffa and George Alameda of Chevron. The following are excerpts from the discussion:
Tell us about yourself. What were some of your early career experiences and major decisions that influenced your career?
MM: I received my BS degree from Texas A&M University in 1985 and an MS degree from Stanford University in 1987—both in petroleum engineering. I joined Chevron in 1987 as a production engineer in Bakersfield, California, and held numerous engineering, operations, planning, and supervisory positions in Bakersfield, New Orleans, and Houston. Before my current position, I was the shale gas team leader for Chevron’s Midcontinent/Alaska business unit where I led a team on subsurface evaluation of the successful acquisition of Chief and Atlas Energy acreage in the Marcellus Shale. I am currently the shale gas asset class manager for Chevron’s Energy Technology Company.
Some of my best career experiences were in the small field offices of Bakersfield, working closely with operations on rod pump optimization and steamflood management. Early in my career I decided to expand my horizons and try different assignments that were sometimes outside my comfort zone. These included gas coordination, upstream recruiting, business planning, and facilities engineering.
GA: My early career included a variety of different assignments. I started out as a research chemist with a degree in math and physics. Although I didn’t have an engineering degree, Chevron allowed me to cross-train in petroleum engineering. This strongly influenced my decision to leave the lab and pursue a career in reservoir engineering that led to management positions in reservoir management as well as information systems.
Unconventional resources such as coalbed methane, shale gas, oil shale, and heavy oil are new areas for big oil majors. How do you think the unconventional industry will shape out in the future? What will be the key drivers? Do you expect new unconventional majors will rise or will current oil majors also come to dominate the sector?
MM: I believe shale gas will become a major energy source globally. The independents defined shale gas in North America, but the majors are taking the lead globally. Many current major integrated oil and gas companies are exploring for shale gas around the world, and I see them continuing to have a big presence in this space in the future. The successful shale gas players of the future will be able to do the following:
- Quickly assess large acreage holdings and focus on the better parts of the resource.
- Develop the resource in an environmentally and socially responsible manner.
- Apply the right technologies to improve production and cost performance.
- Maintain discipline in driving costs out of the system.
GA: I believe the current field of smaller independents will eventually yield their assets to the major players. In my view, the cost of development and the organizational capability required to bring unconventional resources to market are beyond the scope, scale, and capability of the leading independents. Their investors will be handsomely rewarded for their efforts, but in the end I believe the majors will bring the resources to production. I think the key drivers will be access to capital, the skills to manage major capital projects, and the presence of technical talent to staff the big projects. Technology development will be shared between the service companies and the majors. Our contribution will likely be in asset identification, simulation/prediction, and project management.
The unconventional sector is pretty new. Expertise is limited and training new staff requires current experts to spend the necessary time. Do you feel this hampers growth/expansion in this sector? How are companies approaching the issue? Do you think talent creation, attraction, and retention are issues in this new sector? What is your plan for tackling these issues?
MM: Limited talent and expertise will slow growth somewhat, but this may not be a bad thing. This will give the industry time to understand the fundamentals of shale gas and determine the best way to access and develop this resource while addressing environmental and community concerns. Without this current limitation on talent, greater damage could be realized through improper exploitation of the resource along with potentially irreparable damage to the industry’s image. Most companies are working to develop a talent base through retraining personnel, hiring external people, and leveraging business partners.
GA: I believe it is too soon to tell whether or not the limited expertise to which you refer is hampering the growth of the shale gas sector. As far as Chevron’s petroleum engineering population goes, I don’t think this group will have issues of hiring and retention in the shale gas area any different from what we experience in other areas of the upstream business.
Most of the shale gas initiatives in Europe are coming from American, Australian, and British companies. Europe’s old, mighty “utilities”—the likes of Eon, RWE, EDF, Enel, and Vattenfall—remain largely skeptical of the opportunities shale gas offers, while it is becoming an increasingly important resource in the United States. Limited exploration is being done in South America, Africa, Asia, and elsewhere. Do you feel unconventional resources will follow the same pattern of development as conventional whereby technology/exploitation moved from developed economies to undeveloped? Or will we see a surge in exploration across the world? How do you envisage talent creation in these new frontiers? Does this offer opportunities for young professionals (YPs)?
MM: We will probably see both. Technology will continue to transfer from developed to undeveloped economies, and exploration will occur quickly around the globe. The talent creation in the new frontiers will be very similar to that for conventional methods. The goal of the host nations and the oil and gas companies will be to develop a local workforce capable of developing and managing the gas resource from within the country.
GA: I think the majors will discover quickly what makes a good shale gas project and move rapidly to fill their portfolios to a risk balanced level. Then there will be a longer term development curve whereby the more difficult plays will be exploited. Resource opportunity will drive the need to develop our organizational capability and leverage local talent wherever the best plays are located.
Technology related to unconventional resources is quite different from conventional oil and gas technology taught at universities. YPs not only have to learn completely new stuff, but also are expected to help develop new technology. This is quite a change from conventional projects from which YPs learn by applying concepts learned at universities. Learning is also slow as few experts have only a limited amount of time for mentoring. What is your advice to YPs who are working on unconventional projects? Should they concentrate more on learning new stuff or should they look for opportunities in conventional projects at the same time?
MM: Although you can have a meaningful and long-lived future with unconventional projects, you shouldn’t dismiss the opportunities associated with conventional projects. Most of the major capital projects around the world are conventional projects, and this will continue for the foreseeable future. Professionals should continue to keep their skills sharp because change can happen quickly, due to either business or personal needs that require you to shift your career plans.
GA: I would encourage YPs to get a balanced background in conventional and unconventional development. Focusing entirely on geothermal is a good example of what can happen to petroleum engineers and Earth scientists who can find themselves limited in work locations and opportunities due to the geographically limited resource base.
On the same note, do you feel universities should alter their course structure to include additional courses on unconventional resources? What are some current research and development efforts from the industry to improve its technology through industry/university collaboration?
MM: I do believe universities should provide additional courses on unconventional reservoirs. With the majority of land-based rigs in North America drilling for unconventional hydrocarbons (such as shale gas, tight gas, and tight oil), most petrotechnical professionals will be exposed to unconventional resources at some point in their career. Receiving a foundational understanding of these types of reservoirs should be treated similarly to getting a foundational understanding of conventional reservoirs.
GA: I believe unconventional resources should be taught as a junior or senior level course like courses on heavy oil or enhanced oil recovery.
As an industry luminary, what lessons can you share about leadership? What advice do you have for YPs planning to make a career in unconventional resource development? How do you think SPE can help?
MM: Leadership can come in different shapes, sizes, and colors. However, one common theme of leadership is doing the right thing—always—even when you are 100% certain you won’t get caught taking a shortcut. My advice to YPs is to stay true to your values and keep an open mind about your career path. Some of my most memorable job assignments had little to do with the career path I originally perceived when I started full-time work.
SPE can be a portal to the rest of the industry. It can provide training, knowledge transfer, networking opportunities, and friendships that can last a lifetime. Take advantage of everything SPE has to offer and you will be rewarded.
GA: The best advice is to follow your passion. Better to get up every day motivated and excited about what you do. For me, lifelong learning keeps me interested and motivated. I recommend that YPs consider lifelong learning a key element for success. I suggest that SPE continue to consolidate the best papers about methods, offer forums to discuss unconventional resources, and encourage the sharing of ideas.