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E&P transforms mortals into believing they are supermen: Tom Bower! I reviewed the text of Tom Bower’s talk at Petrotech 2014. The argument is strong and articulates why E&P outside the ‘patronage’ of top IOC’s is a failure. Tom says – “Only a handful of major oil corporations have the expertise to develop the difficult oil and gas reserves”. It is possible that complete dependency on IOC’s is the fait accompli for the E&P. It is possible that E&P pursues approaches of other highly knowledge intensive sciences and technologies to become independent. Ehtics, Discipline, Innovation, Technology, and Persistence seem to have given IOC’s the advantage. Other E&P companies do not have long-term approach to all of these. We have 2 options: 1) Accept Tom’s complete dependency theory or 2) Develop 21st Century alternative E&P model In my earlier presentation on BIG CREW CHANGE -{ http://www.slideshare.net/srikantg/the-reality-of-big-crew-change-in-ep }, I argued how E&P as Science and Technology is NOT TRANSFORMATIONAL. This Presentation draws upon Tom Bower's talk to showcase the poor performance of most E&P companies and the possible way out! IT MATTERS TO YOU. Your Petrol/Gasoline price is related to E&P efficiency!!
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TECHNOLOGY ~ E&P INDUSTRY
Tom Bower’s Petrotech 2014 keynote
The Squeeze : IOCs control the success in E&P
In my opinion, one lesson can be drawn. Only a handful of major oil corporations have the expertise to develop the difficult oil and gas reserves
Summary
1. Tom Bower’s speech in Petrotech 2014 argued the ‘consistent failure’ of E&P ventures functioning outside the support of big IOCs
2. Dependency on competencies, processes and nuances of oil majors is shown as inevitable. IOCs are the only with reliable skills!
3. Proof is drawn from Russia, S.America and Middle-East. “Only a handful of experts under the management of American and European corporations can manage the E&P efficiently,
Is it the FINAL WORD?
1. E&P is highly integrated and complex - few other industries also have it.
2. Unlike E&P other knowledge intense industries DO NOT have the strangle-hold “Squeeze” of few dominant players.
3. A number of successes with more complex knowledge exists
4. E&P’s sciences and technologies are arguably the lowest in adapting information central approach & crowd-sourcing: Laggard?!
5. Work ethics, intelligent, driven and committed oil men and women are difficult in places where E&P failed (including India)
We have 2 options: 1) Accept Tom’s complete dependency theory or 2) Develop 21st Century alternative E&P model
4-Jul-14 CONFIDENTIAL NOTE 2
Tom’s points : Uncertainty & Reliable Technology
Predictions proven to be so unreliable
Uncertainty to breed contempt for industry
Public seize any opportunity to attack the oil corporations for profiteering
No one tells the TRUTH
Exxon, Shell, BP, Chevron & Total: oil majors are THE (only) SUCCESSFUL!
Their skills enhance the industry.
They bring RELIABILITY of technology to handle uncertainty
They run E&P on science and principles.
4-Jul-14 CONFIDENTIAL NOTE 3
Common Experience in E&P
Making of IOCs as Successful players
IOC Abide by rigid engineering
(scientific) discipline
Initiate and manage technical innovation.
Don’t attempt short-cuts, (fly-by-night | depend on hired guidance) , cost-cutting, or random risk - losing the gamble.
Clear approach to Innovation, Technology, Ethics, Integrity, Discipline and Measurement.
Other E&P Ethics, Integrity & Discipline:
All-bodies always follow it.
Innovation: Everybody’s job! Anybody, Somebody, & Nobody owns it! It all happens by itself?!
Technology: follows innovation. It is always at its optimum?!
Measure only financial and absolutely mandatory data!!
4-Jul-14 CONFIDENTIAL NOTE 4
E&P transforms mortals into believing they are supermen
To Be or Not to be 1. - Become top global HC
producer
2. - Reach top of HC value chain in a country/region
3. - Get Respected as Partner of choice by stakeholders
4. - Develop and Retain best in class “people, processes & technologies”
5. - Establish a good governance & risk management
All E&P companies wish
Tom Bower demonstrates that just a handful realize it.
INNOVATION is not a faint, random, chance event
TECHNOLOGY is a systematic continuous program
ETHICS, INTEGRITY, DISCIPLINE are the foundation
4-Jul-14 CONFIDENTIAL NOTE 5
