A new oil and gas survey was released today and it showed 75 per cent of contractors are worried about future prospects on the UK Continental Shelf (UKCS) – more than those surveyed in 2015. Just 7 per cent of contractors said they were more confident this year when comparing it to last year. The survey also revealed other worrying statistics across the industry.
The findings, from the 24th Oil and Gas Survey, conducted by Aberdeen and Grampian Chamber of Commerce in partnership with the Fraser of Allander Institute and sponsored by law firm Bond Dickinson, also reveal a bleak employment situation in the sector. Oil and gas operators say they have seen a 15 per cent reduction in their UK-based headcount over the past 12 months, and expect a further reduction of 17 per cent over the coming year.
While 42 per cent of firms in the sector cite increasing efficiency or productivity as their main priority, one in four (23 per cent) cites cutting costs as their number one priority.
Just 14 per cent of contractors report that they are working at or above optimum levels in the UKCS, a huge decline since the 79 per cent reported just three years ago. Global pressures appear to be taking their toll on overseas operations as well, with only one in four firms (27 per cent) working at or above optimum levels overseas – a historic low.
Russell Borthwick, chief executive at Aberdeen and Grampian Chamber of Commerce said: “Respondents have reported falls in activity, but a slightly higher number are working at capacity internationally. Looking a year ahead, there is perhaps a shard of light as confidence looks relatively higher for international markets.
“In the previous two surveys we carried out, we found confidence had hit record lows, with an all-time low in November 2015. This time, while the figure is still firmly in negative territory, it has marginally improved, which may perhaps show we are near the bottom of the curve.”
Eighty-five per cent of contractors expect to increase their involvement in decommissioning work over the next three to five years, up from 79 per cent in the previous survey and the highest figure since this question was first asked in 2010.
Uisdean Vass, oil and gas partner at Bond Dickinson, commented: “Sometimes you have to look behind the statistics to see the true picture and that is the case with decommissioning. Although decommissioning will offer great opportunities it is like the funeral industry – we want to put it off for as long as possible.
“The uncertainty which all those in the industry face at the moment regarding their livelihoods continues and any slowdown in the shedding of jobs does not appear to be materialising.”
Level of demand (94 per cent), commodity price (95 per cent) and economic climate (95 per cent) are seen as the most important factors constraining contractors’ UKCS activity, followed by complex regulations (68 per cent), taxation issues (70 per cent) and costs of capital (71 per cent). Skills shortages were seen as a limiting issue by 50 per cent of contractors, and the loss of staff to other companies by 43 per cent.
These constraints have contributed to a decline in investment expenditure. In the past 12 months, 44 per cent of contractors have reduced their overall investment against just 11 per cent who have increased it. This trend is expected to continue, with 42 per cent of contractors expecting to reduce their investment over the next two years, compared to just 12 per cent who expect to increase it.
Nearly half of respondents (45 per cent) said it is difficult to reach a clear view about whether a vote in favour of exiting the European Union would be a positive development for the oil and gas sector or not, and a further one in five (20 per cent) said it would make little difference to the sector. Of those who expressed a firm opinion, the feeling was that remaining in the EU would be the best outcome, with 27 per cent of respondents saying a Brexit would be unhelpful, compared to eight per cent who believed it would be a positive development.
Uisdean Vass added: “One thing about which the majority of the industry is united is the impact of the European referendum. Most are “unfazed” at the outcome so, just as with the Scottish independence referendum, operators and contractors have shown they believe constitutional matters have little impact on their businesses.”
Is Wood Burning Sustainable For Your Home?
Wood is a classic heat source, whether we think about people gathered around a campfire or wood stoves in old cabins, but is it a sustainable source of heat in modern society? The answer is an ambivalent one. In certain settings, wood heat is an ideal solution, but for the majority of homes, it isn’t especially suitable. So what’s the tipping point?
Wood heat is ideal for small homes on large properties, for individuals who can gather their own wood, and who have modern wood burning ovens. A green approach to wood heat is one of biofuel on the smallest of scales.
Is Biofuel Green?
One of the reasons that wood heat is a source of so much divide in the eco-friendly community is that it’s a renewable resource and renewable has become synonymous with green. What wood heat isn’t, though, is clean or healthy. It lets off a significant amount of carbon and particulates, and trees certainly don’t grow as quickly as it’s consumed for heat.
Of course, wood is a much less harmful source of heat than coal, but for scientists interested in developing green energy sources, it makes more sense to focus on solar and wind power. Why, then, would they invest in improved wood burning technology?
Solar and wind technology are good large-scale energy solutions, but when it comes to small-space heating, wood has its own advantages. First, wood heat is in keeping with the DIY spirit of homesteaders and tiny house enthusiasts. These individuals are more likely to be driven to gather their own wood and live in small spaces that can be effectively heated as such.
Wood heat is also very effective on an individual scale because it requires very little infrastructure. Modern wood stoves made of steel rather than cast iron are built to EPA specifications, and the only additional necessary tools include a quality axe, somewhere to store the wood, and an appropriate covering to keep it dry. And all the wood can come from your own land.
Wood heat is also ideal for people living off the grid or in cold areas prone to frequent power outages, as it’s constantly reliable. Even if the power goes out, you know that you’ll be able to turn up the heat. That’s important if you live somewhere like Maine where the winters can get exceedingly cold. People have even successfully heated a 40’x34’ home with a single stove.
Benefits Of Biomass
The ultimate question regarding wood heat is whether any energy source that’s dangerous on the large scale is acceptable on a smaller one. For now, the best answer is that with a growing population and limited progress towards “pure” green energy, wood should remain a viable option, specifically because it’s used on a limited scale. Biomass heat is even included in the UK’s Renewable Heat Initiative and minor modifications can make it even more sustainable.
Wood stoves, when embraced in conjunction with pellet stoves, geothermal heating, and masonry heaters, all more efficient forms of sustainable heat, should be part of a modern energy strategy. Ultimately, we’re headed in the direction of diversified energy – all of it cleaner – and wood has a place in the big picture, serving small homes and off-the-grid structures, while solar, wind, and other large-scale initiatives fuel our cities.
7 Benefits You Should Consider Giving Your Energy Employees
As an energy startup, you’re always looking to offer the most competitive packages to entice top-tier talent. This can be tough, especially when trying to put something together that’s both affordable but also has perks that employees are after.
After all, this is an incredibly competitive field and one that’s constantly doing what it can to stay ahead. However, that’s why I’m bringing you a few helpful benefits that could be what bolsters you ahead of your competition. Check them out below:
One benefit commonly overlooked by companies is offering your employees financial advising services, which could help them tremendously in planning for their long-term goals with your firm. This includes anything from budgeting and savings plans to recommendations for credit repair services and investments. Try to take a look at if your energy company could bring on an extra person or two specifically for this role, as it will pay off tremendously regarding retention and employee happiness.
While often included in a lot of health benefits packages, offering your employees life insurance could be an excellent addition to your current perks. Although seldom used, life insurance is a small sign that shows you care about the life of their family beyond just office hours. Additionally, at such a low cost, this is a pretty simple aspect to add to your packages. Try contacting some brokers or insurance agents to see if you can find a policy that’s right for your firm.
Dedicated Time To Enjoy Their Hobbies
Although something seen more often in startups in Silicon Valley, having dedicated office time for employees to enjoy their passions is something that has shown great results. Whether it be learning the piano or taking on building a video game, having your team spend some time on the things they truly enjoy can translate to increased productivity. Why? Because giving them the ability to better themselves, they’ll in turn bring that to their work as well.
The Ability To Work Remotely
It’s no secret that a lot of employers despise the idea of letting their employees work remotely. However, it’s actually proven to hold some amazing benefits. According to Global Workplace Analytics, 95% of employers that allow their employees to telework reported an increased rate of retention, saving on both turnover and sick days. Depending on the needs of each individual role, this can be a strategy to implement either whenever your team wants or on assigned days. Either way, this is one perk almost everyone will love.
Even though it’s mandated for companies with over 50 employees, offering health insurance regardless is arguably a benefit well received across the board. In fact, as noted in research compiled by KFF, 28.6% of employers with less than 50 people still offered health care. Why is that the case? Because it shows you care about their well-being, and know that a healthy employee is one that doesn’t have to worry about astronomical medical bills.
Unlimited Time Off
This is a perk that almost no employer offers but should be regarded as something to consider. According to The Washington Post, only 1-2% of companies offer unlimited vacation, which it’s easy to see why. A true “unlimited vacation” program could be a firm’s worse nightmare, with employees skipping out every other week to enjoy themselves. However, with the right model in place that rewards hard work with days off, your employees will absolutely adore this policy.
A Full Pantry
Finally, having a pantry full of food can be one perk that’s not only relatively inexpensive but also adds to the value of the workplace. As noted by USA Today, when surveying employees who had snacks versus those who didn’t, 67% of those who did reported they were “very happy” with their work life. You’d be surprised at how much of a difference this could make, especially when considering the price point. Consider adding a kitchen to your office if you haven’t already, and always keep the snacks and drinks everyone wants fully stocked. Doing so will increase morale tremendously.
Compiling a great package for your energy company is going to take some time in looking at what you can afford versus what’s the most you can offer. While it might mean cutting back in other areas, having a workforce that feels like you genuinely want to take care of them can take you far. And with so many different benefits to include in your energy company’s package, which one is your favorite? Comment with your answers below!