Focus: North American oil production boom, wall, harsh conditions and unmanageable | Reuters

[Reuters]–Jeremy Davis, 38, who worked in an oil field in Texas, USA, was fired in 2020. He never left the energy industry, where he had been working for 17 years, but since then he has been hit by a series of unfortunate events in his workplace.

Jeremy Davis, 38, who worked in an oil field in Texas, was fired in 2020. He never left the energy industry, where he had been working for 17 years, but since then he has been hit by a series of unfortunate events in his workplace. His photo was taken in June 2018 in the Appalachian Basin, USA (2022 Reuters / Deep Well Services)

At a chemical product production factory, he was hospitalized about a week after starting shift work. After that, he wasn’t paid at all by another company and was taken out for $ 5,000.

“There are times when I’m terribly frustrated by the unpredictability and stability (lack of),” says Davis. He is currently in the construction industry near his home in the suburbs of Austin, Texas. Davis says returning to the energy industry is an option, but for the time being he will continue his current job.

In the United States and Canada, there are thousands of workers like Davis who have left oil and gas jobs. Some have changed jobs in the renewable energy industry as the world shifts to clean energy because of intolerable working conditions, remote workplaces, and inadequate compensation.

Crude oil prices have remained around $ 100 due to a global supply shortage, and the government is demanding that oil and gas producers increase production. While Russia is looking for ways to offset the impact of Russia’s invasion of Ukraine on the market, oil and gas companies in the United States and Canada are hampered by labor shortages to increase production.

Since the beginning of the pandemic of the new coronavirus, a large number of workers have left their jobs in oil development. The unemployment rate in the United States has recently improved to 3.6%, a little higher than before the pandemic, but the number of workers in the oil and gas industry remains about 100,000 less than before the pandemic.

Employment in the oil industry is recovering rapidly in Canada. Companies have moved to secure human resources, and workers have become able to take a bullish stance in welfare and wage negotiations.

Andy Hendricks, CEO of Patterson UTI Energy, said, “The recruitment briefing held in San Antonio and other places was expected to attract about 200 visitors before the Korona-ka, but now it is about 50-100. “. The company is currently operating about one-sixth of the 695 drilling rigs in the United States.

The company plans to rehire 3,000 people last year and hire an additional 3,000 people this year. Recruiters are also assigned to shopping malls in Williston, North Dakota to find talent.

According to Darren Gee, CEO of Calgary-based Pate Explorations and Development, Canada, the company plans to increase oilfield drilling if it has the resources. The company’s oil and gas production is 98,000 barrels of oil equivalent per day.

“If we can get talent, we’ll probably increase our capital investment budget this year,” Gee said, but he also pointed out that newly hired workers are often inexperienced. The University of Calgary has suspended its oil and gas engineering course as one of the reasons why the oil and gas industry is struggling to acquire new suitable materials.

According to the Energy Workforce and Technology Council, an energy-related services industry group, the number of employees in the oil field services and drilling sector in the United States was about 609,000 in March, the highest since September 2021. It is still below the pre-pandemic number of about 707,000.

Mark Marmo, CEO of Deep Well Services, an oilfield company based in Zerienopur, Pennsylvania, says that hydraulic fracturing operations are currently delayed by two weeks to a month, especially in western Texas. “We hired 350 people. If we can hire another 350 people, we will put everyone into work,” he said.

According to estimates by the Statistics Bureau of the US Department of Labor, 14,000 people left their jobs in the mining and forestry industries, including the oil and gas sector, in January this year. This is the highest number since the beginning of 2020, and about 13,000 people left the workplace in February.

“Some companies hire 100 new people in the Permian Basin, leaving only 8-9 people six months later,” said Tim Tarplay of the Energy Workforce and Technology Council.

The oil and gas industry in the United States and Canada is expected to increase production despite tight labor market supply and demand. But industry executives say production could exceed expectations if more workers could be secured.

According to the U.S. Energy Conservation Information Agency (EIA), U.S. production will increase by about 800,000 barrels a day to an average of 12 million barrels this year, reaching a record high of 12.3 million barrels a day in 2019. Is not expected to reach. Canada’s production of natural gas is expected to increase by 190,000 barrels per day to 5.75 million barrels per day.

Terry Parker, executive director of the Building Trades of Alberta, an industry group in Alberta, Canada, said thousands of workers in the oil sands production area on the outskirts of Canada due to the critical maintenance of production facilities. The number of skilled workers who are willing to go to the site when they need it is decreasing. This is because the company is no longer paying extra for these inconvenient business trips.

According to Parker, the hourly wage in the oil sands industry is $ 30 for low proficiency and $ 50 for high proficiency.

Average weekly wages, including overtime pay for mining and quarrying, and oil and gas drilling, have increased by 7.3% since February 2020, according to Statistics Canada data.

According to oilfield consultancy Spears and Associates, the average hourly wage for production and non-managerial employees in the United States is now about 5% higher than it was a year ago, and wages for oilfield workers are expected to increase by about 10% annually.

But according to the Census Bureau of the US Department of Labor, the average hourly wage in the oil and gas drilling sector was $ 45.45 as of February this year, well below the $ 48.37 as of February 2008 before the pandemic.

Last year, the company raised wages to compete with the retail industry, which historically has lower wages than the oil industry, according to Hendricks of Patterson UTI Energy.

“We’re competing with Amazon hiring drivers and targets looking for people in air-conditioned warehouses. It’s easier than working on a drilling rig in western Texas in the summer,” he said. ..

(Reporters by Liz Hampton, Stephanie Kelly, and Nia Williams)