1F W Schroeder 1

Career Opportunities

Energy Industry

in the

Most Images Courtesy of ExxonMobil

2F W Schroeder 2

Outline

• A Bit about Me

• What We Do in the Energy Industry – G&G

• My Outlook for Energy Industry Careers

– Three Big Positive Factors

– Two Major Concerns

• How Can You Prepare

• Q&A

3F W Schroeder 3

My Training & Career Path

4 years,

B.S. in Engineering Physics

6 months as a

Visiting Lecturer

32 years, EPR-URC

Seismic R&D, Training

3 years as a

Geological Advisor

3 years as a

Tutor

5 years, M. Phil. and

PhD in Marine Geology

4F W Schroeder 4

Coming Out of Grad School

I Was Triple Blessed:

1. Industry just started a hiring boom

2. I received an offer from Exxon Research

3. I was assigned to the Seismic Stratigraphy section and was mentored by:

Pete VailBob Mitchum

5F W Schroeder 5

My Areas of Study

1. R&D New Methods

2. Apply New Methods

3. Training/Mentoring

• Seismic Interpretation (2D & 3D)

• Seismic Stratigraphy

• Basin Modeling

• Seismic Attribute Analysis

• Volume Interp & Visualization

Baltimore Canyon

US Gulf Coast

Exmouth Plateau

Nigeria

Angola

Columbia

Chucki Sea

Beaufort Sea

Haltenbanken

Goban Spur

CedunaBasin

Viking Graben

Mergui Basin

GippslandBasin

Pearl River Mouth

Yellow Sea

Venezuela

Central Graben

Malay Basin

MidlandBasin

Eq. Guinea

Chad

Basin Studied 6+ months

East Med

Falklands

Cameroon

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What We Do in the Energy Industry

Exploration

Production

Refining

Marketing

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Challenge for the Upstream

Worldwide demand for energy will increase steadily out to

2040 and beyond

Projected demand for oil

and gas in 2040 is 45% more

than it is in 2015100

200

150

400

350

300

250

450

1990 2015 2040

Energy Supply/DemandMBDOE

150

There is a huge GAP between projected production from existing fields and what

needs to

produced through 2040 to meet the demand

2030

MBDOE

2020

200

160

120

80

40

2000 2010 20401990

Courtesy of ExxonMobil

8F W Schroeder 8

What We Need

Conclusion: The energy industry needs new geoscientists

with the talent and drive to find, develop and

produce the energy that people will need.

We need as accurate an understanding of the subsurface as possible so we can:

We need to drill ‘good’ wells, ones that have low risk and maximize the return on our investments

Maximize oil & gas recovery from known fields

Move probable & static assets to proven reserves

Discover new reserves beneath & adjacent to known fields

Find and produce oil & gas in new areas

Since wells can be very expensive, some more than $200 million, we must position each well with care

9F W Schroeder

What We Need for Success

A Simple View

A “Kitchen”Where Organic

Material IsCooked

A “Container”From Which

Oil & Gas Can Be

Produced

“Plumbing” To Connectthe Container to the Kitchen

CorrectlyPlacedWells

9

10F W Schroeder

Summary of the North Sea HC System

Brent Sandstoneacts as a reservoir and carrier beds

Heather ShaleSognefjord Shale/Sand

both organic poor

FaciesChange

Draupne Shaleorganic rich

serves as a source rock

Brent Coalsacts as gas source

HC Generation & Expulsionoil & gas from Draupne, gas from Brent coals

HC Migrationinto Brent carrier beds and up faults

HC Fill & Spill

Fault

Leak

Point

Oil

Spill

Point

late gas displaces early oil in thedeeper traps; oil into shallow traps

Schroeder & Sylta, 1993

10

11F W Schroeder 11

My Outlook for Careers in Industry

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Oil & Gas Prices

12

• The energy industry goes through cycles (of about 7 – 10 years)

• These cycles are dictated by oil and gas prices

• Right now prices are low and companies are tightening belts

• 2015 will see a reduced number of job openings and internships

• When prices rebound, the demand for new hires will spike

• We have to wait for the sun to come out from behind the cloud

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Three BIG Positive Factors

1.

2. Technology Needs

3. Industry Demographics

1. Energy Demands

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Energy Demands UP, Existing Production DOWN

2030

MBDOE

2020

200

160

120

80

40

2000 2010 20401990

Geoscientists are Needed to Fill this

GAP?

100

200

150

400

350

300

250

450

1990 2015 2040

Energy Supply/DemandMBDOE

As You Have Seen…

15F W Schroeder 15

Sources of Energy Forecast

after Edwards,AAPG 8/97

19001900 19201920 19401940 19601960 19801980 20002000 20202020 20402040 20602060 20802080 30003000

2020

4040

6060

8080

100100100 BILLION

BARRELS

BillionBarrels

of OilEquivalent

per Year(GBOE)

BillionBarrels

of OilEquivalent

per Year(GBOE) Natural

GasNatural

Gas

Hydroelectric

Crude OilCrude Oil

Solar, WindGeothermal

Nuclear Electric

1993

CoalCoal

Decre

asin

gF

ossil F

uels

Ne

w T

ec

hn

olo

gie

s

World Energy Demand

Careers in

Oil & Gas

Remain Important

Projected Demands

35 Year Career

Starting 2015

16F W Schroeder 16

Technology Needs

• To meet energy demands, we can’t count on simply making ‘giant new discoveries’

• In addition to making new discoveries, we need to get more out of what we already have found:

– New life in old fields

– Make ‘uneconomic’ reserves economic

• Technology, and the people to develop and apply it, will be the key

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Industry Demographics

Age Brackets for a Typical Major Oil Company (2013)

0

5%

10%

15%

20%

25%

30%

30-34 35-39 40-44 45-49 50-54 55-59 60+

Age (YRS)

Ge

oscie

nce

Wo

rkfo

rce

25-29

Staffing is now

a HUGE concern!

1977-84

Hiring Boom

Retirements

Hiring

Slow-down

7%9%

6%

12%

19%

27%

12%

8%

18F W Schroeder

Career Forecasts – by 2021

18

262,627 geoscience jobs today

~130,000 geoscientists expected to retire by 2021

72,000 geoscience job growth by 2021 (BLS)

15,000 totalnew graduates (MS or PhD)

45,000 totalnew graduates if hiring BS/BA

OR

Net deficit of over 150,000geoscientists by 2021

From: Eric M. Riggs and

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Two Major Concerns

19

Recent drop in the price of oil (down almost 40%)

Number of Geoscience Majors is high

a recent AAPG/SEG Student Expo

2014 Price of Brent Crude

Oil as of

Dec 9, 2014

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Some History: 1946 to 1970

20

US demand was less than our production capacity – the spigots were not open 100%

We did not require imported oil to meet our needs

Oil prices were quite stable

Oil

Pri

ce

($

/B

bl)

Adjusted to 2014 $

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More Recent History: 1970 - 2014

21

US demand exceed US production capacity – the spigots were opened 100%

Henceforth we required imported oil to meet our energy needs

World economic and political events drive price extremes

1. Concerns over supply disruptions

2. Production quotes of suppliers

3. World financial instabilities

4. Production from Unconventionals

Oil Embargo led

to long gas lines

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Oil Prices: 1970 - 1988

2222

Windfall Profits Tax

Price Controls

Strategic Pet Res

Oil P

rice $

/Bb

l

Real Oil Prices ($2014)

Iranian

Revolution

Yom Kippur War

Oil Embargo

Iran/Iraq

War

1. Concerns over supply disruptions

OPEC Prod.

Down to 15 MMBpd

OPEC Prod.

@ 30 MMBpd

OPEC Prod.

Up to 28 MMBpd

OPEC Increases

Prod. For Mkt. Share

2. Production quotes of suppliers

OPEC

cut 50%

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Oil Prices: 1988 - 2014

23

1. Concerns over supply disruptions

9/11

Attacks

Arab Spring

Iraq War

PDVSA Strike

Asian Growth

Low OPEC Spare Capacity

Gulf War

Oil

Pri

ce $

/Bb

l

Real Oil Prices ($2014)

OPEC Prod.

Up to 28 MMBpd

2. Production quotes of suppliers

OPEC Prod. Averages

30 – 35 MMBpd

OPEC Prod.

Varies

4. Production - Unconventionals

Oil Shale Growth

OPEC Maintains

Production to

Retain Market Share

Recession

Asian Financial

Crisis

3. World financial instabilities

Japan in Recession

Europe on Brink

24F W Schroeder

Current Price Collapse

24

Significant production from unconventionals has added to our supply

OPEC has not reduced production (as they traditionally would have)

We have a slight over-supply (more produced in a day than consumed)

This has caused oil prices to drop ~50%

Wells, especially in unconventional fields, are being shut in, which will lower daily production

With time, we’ll balance supply with demand and prices will stabilize at $__ /barrel?

25F W Schroeder

G&G Students

25

Long term – we will need a lot of geoscience professionals to replace those retiring and to accommodate the predicted job growth

Short term – Many are graduating at a time when companies are cutting expenses

Starting a career during the next 12 (?) months will be challenging

Companies will be very selective

Great qualifications and a lot of effort

After oil prices rise and stabilize, hiring will spike to make up for the hiring slowdown

26F W Schroeder 26

Therefore……

• Thinking long-term, this is an ideal time to be working towards a geoscience degree

• Recruiting activity should dip but then RISE

• When prices rebound, Demand >> Supply

Analytical

Thinking

Bright

Ideas

Timing

is Great

Excellent

PayWill be X

27F W Schroeder 27

Current Salaries: 0 – 2 Years Experience

Average Salaries

Salaries by Degree0 – 2 Years

B.S. M.S. Ph.D.

$92,000 $103,800 $115,000Source: AAPG Explorer

$50,000

$55,000

$60,000

$65,000

$70,000

$75,000

$80,000

$85,000

$90,000

$95,000

2002 2003 2004 2005 2006 2007 2008 2009 2010

Up $28k in 8 years

3.5k per year

$82.2

k

$74.4

k

$67.8

k

$65.6

k

$6

5.0

k

$83.6

k

$82.8

k $87.6

k

50

60

70

80

90

100

110

1 2 3 4 5 6 7 8 9 10 11 12

Salary

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

$6

5.0

k

$8

2.2

k

$7

4.4

k

$6

7.8

k

$6

5.6

k

$8

3.6

k

$8

2.8

k $9

3.0

k

$8

7.6

k $9

8.7

k

$1

00

.5 k

$1

03

.4 k

Average Increase of $3.5k/year

Do

lla

rs (

tho

us

an

ds

)

28F W Schroeder 28

Which Degree Should I Get

• BS or BA

– A geotech for a large company, not recruited

– In the trenches for a small company

• Masters

– Bulk of people in industry

– Able to hold any position, may be hard to get into a research role initially

• PhD

– Some companies may think you are over-qualified

– Advisable if you want to do applied research for a mega-company

– Advisable if you may want to become a Prof.

– Small difference in starting salaries for 2+ more years

29F W Schroeder 29

How Can I Prepare?

• Undergrad Level

– Excel in all your courses – high GPA

– Take fundamental, classic geoscience courses

– Get exposure to all disciplines – attend seminars

– Scan professional society journals – take note of who is working on topics that interest you

– ASAP decide on a sub-discipline

– Choose a “senior topic” that you have a lot of interest in, work it well, be creative and application-minded

30F W Schroeder 30

How Can I Prepare?

• Grad Level

– Choose a high-caliber university with a great geoscience department

– Excel in all your courses – high GPA

– Take courses that will give the depth & breadth

– Look for way to demonstrate leadership potential

– Get some good work experience – internship

– Choose a research topic that we have passion for; better to have a superb thesis topic on something unrelated to industry than a mediocre thesis

– Polish your resume/CV – sell yourself

– Gain interviewing experience

31F W Schroeder 31

Big vs. Small Companies

A BIG company

– Competition is great

– Work with great minds

– Pressure to perform

– Can specialize

– Able to shift a lot

– May rank below average

– No special treatment

– Mega-bureaucracy

A SMALL company

– Competition is still high

– Work more friendly

– A bit less pressure

– Jack of all trades

– Not much latitude

– May rank above average

– Individual rewards

– Less bureaucracy

32F W Schroeder 32

What to Look For

• Salary, vacation, work hours

• Location

• People & facilities

• Training program

• Benefits, includes a pension?

• Job and work environment

• Stability – what happened in down cycles?

• Bureaucracy

• Initial assignment

• Opportunities to grow/move

33F W Schroeder 33