According to the latest figures gathered by Predence Research, the global oil and gas market is valued at USD 27.94 billion as of this year. Despite the steady shift toward greener energy, the industry is still projected to hit USD 47.82 billion by 2034 at a healthy CAGR of 5.52%. According to the U.S. Energy Information Administration, the surge in global energy demands due to rising temperatures is one of the key drivers of this growth.

The industry, though essential, is a source of some of the world’s worst ecological disasters, such as the Deepwater Horizon incident, the 2005 Texas City Refinery Explosion, and the Macondo Well Blowout, which originated from weak workforce training.

The key to improving operational excellence in this sector is to address the primary challenges that plague it, namely, safety risks, skill deficits, and the sheer operational complexity of operations involved, and the best way to go about it is with a workforce learning and development strategy that suits everyone.

This blog will highlight the current hurdles this industry has to overcome to attain sustainability and how you can use L&D to overcome them.

Table of Contents:

Understanding the Energy Transition

The transition to cleaner energy presents a compelling opportunity for job creation. In a major report, the International Energy Agency (IEA) predicts over 30 million fresh jobs in the green energy sector by 2030.

The employment market for fossil fuels will contract in tandem with this increase, especially in sectors like coal supply, which are experiencing significant downsizing due to decarbonization and automation. Proactive workforce transformation is necessary to capitalize on the opportunities a low-carbon energy future has created.

This workforce transformation process is already underway for businesses and employees looking to acquire a competitive edge. Fortunately, most current energy experts are well-positioned to move to cleaner energy sources.

The good news is that most energy experts who are now employed are qualified to switch to cleaner energy sources.

According to a recent Robert Gordon University study, more than 90% of UK workers in the oil and gas industry have transferable skills highly applicable to positions in renewable energy. These transferable abilities, including project management, engineering, and health and safety procedures knowledge, and experience servicing and maintaining complicated systems, are all valuable assets in the renewable energy industry.

An Overview of Oil and Gas Training Programs

The oil and gas sector is rapidly changing, making it more challenging for businesses to keep their workforce updated in terms of skills and knowledge. Here is a snapshot of key changes:

1. Stronger Regulations

The regulatory bodies governing the sector are strengthening the guidelines. They are also moving to enforce them stringently. Hence, businesses must ensure that employees are up-to-date in their understanding of compliance.

2. Shift to Green Practices

All businesses are expected to increase investments in developing environmentally relevant practices. By 2023, the World Economic Forum’s Reskilling Revolution initiative, for instance, aims to train over 200 million people to be equipped for green jobs.

3. Multi-Skilled Workforce

Oil and gas employees need to cultivate a mix of technical expertise and soft skills. These comprise petroleum engineering and technical skills (25%), instrumentation and control systems (15%), communication skills (20%), problem-solving skills (15%), industry regulations (10%) and safety protocols (15%).

4. Adoption of Digital Technologies

By 2027, a growing number of oil and gas companies are expected to adopt four types of digital technologies comprising user and entity big data analytics (87%), the Internet of Things (IoT) (83%), cloud computing (78%), and wearable electronics (70%).

Essential Compliance Standards for the Oil and Gas Industry

Environmental compliance ensures oil and gas companies mitigate their ecological footprint and avoid penalties like those recently imposed on Ovintiv USA Inc. and the Apache Corporation.

Understanding the wide range of laws that control every aspect of the oil and gas industry’s operations is the first step toward compliance. Here are the main compliance categories and the specific standards that are relevant in this case.

1. Adherence to Environmental Regulations

Regulatory bodies place a lot of emphasis on the condition of the environment and the need to prevent further deterioration.

The following rules are intended to prevent contamination of the soil, water, and air:

  • The Clean Air Act (CAA) controls equipment emissions and guarantees that air quality requirements are fulfilled. The Clean Water Act (CWA) regulates oil spill prevention and wastewater disposal. The Superfund Act, or CERCLA, oversees the cleanup duties for hazardous substances.

2. Compliance with Health and Safety

Workers are protected from the risks of oil and gas operations by health and safety regulations. Among the important norms upheld here are:

3. Operational and Equipment Compliance

This category ensures the safe functioning of machinery and tools critical to operations in the oil and gas industry:

  • API Standards: Provided by the American Petroleum Institute to regulate equipment design and maintenance.
  • IECEx/ATEX: Certify electrical equipment used in explosive atmospheres.

The Current Challenges Facing the Oil and Gas Industry in Its Progress Toward Sustainability

The Oil and Gas industry is at a critical juncture. On the one hand, there is a rising demand for fossil fuels, while on the other hand, there is immense global pressure to attain high levels of sustainability.

One of the primary hurdles this industry faces is renewable energy integration into the current supply chain. While renewable energy is by no means a new technology, its integration into this industry requires a monumental shift in technology, the infrastructure to support it, and the implementation of new SOPs.

Then, we come to the skills gap. The Oil and Gas industry is primarily comprised of engineers who specialize in petroleum, biochemical, or physics, combined with welders, drilling experts, pipeline specialists, and so on. What it needs is expertise in corporate sustainability programs.

Finally, we get to adequate training and workplace compliance. What do the Deepwater Horizon spill of 2010, the Exxon Valdez Oil spill of 1989, and the Piper Alpha incident of 1988 have in common? Any guesses? They were all incidents that occurred as a result of human error. A study has found that this one factor, human error, accounts for nearly 70% of all accidents in this industry. A challenge that needs to be addressed, with the stakes being this high.

How Can Workforce Learning and Development Help Address the Challenges?

The Oil and Gas industry can take significant strides toward sustainability by investing in workforce learning and development. Doing so can help in the following:

1. Cultivate a Sustainability Mindset

To initiate a shift toward sustainability, you must initiate a foundational change in the mindset of people who work in this sector. Workforce sustainability training will help educate employees and decision-makers about the

  • Environmental impact of the industry.
  • Raise awareness about the importance of sustainability
  • Educate the workforce about any corporate sustainability programs their organization has committed to.

2. Bridge the Skills Gap

Once you have sown the seeds of change, the next step is to bridge the skills gap required to integrate renewable energy with existing systems. Workforce learning and development can help upskill existing employees or train new hires on renewable energy systems or their management.

3. Improve Operational Efficiency

Any improvement in efficiency has a direct impact on sustainability. Implementation of the right technology, for example, IoT sensors at key junctures, can help prevent the waste of precious resources like water and energy. That said, the adoption and implementation of any new tech must be supplemented by adequate training to extract the most out of them.

4. Safety and Regulatory Compliance

Robust training programs can significantly reduce the risk of accidents and environmental incidents like the ones we covered earlier. The oil and gas industry requests strict adherence to SOPs, safety protocols, environmental regulations, and, if all else fails, emergency response and disaster management protocols.

5. Drive Innovation

An ancillary benefit of investing in workforce learning and development is innovation. A training environment is a prime location to discuss and share ideas that can help your specific organization come up with the best sustainability initiatives in the oil & gas industry and innovation that can help drive other industries toward a greener future, too.

The Scope of Procurement Workforce in the Oil & Gas Industry

For an effective and efficient workforce development strategy, it is vital to understand what procurement in the oil and gas industry entails. Here’s a quick overview of what key responsibilities the hiring and development teams must consider:

  1. Strategic Sourcing: Identifying and securing optimal suppliers for goods and services such as drilling equipment, pipelines, and chemicals.
  2. Contract Negotiation: Achieving favorable terms and conditions for the company’s rights, such as pricing, payment terms, delivery schedules, and performance guarantees.
  3. Supplier Relationship Management: Building and cultivating strong partnerships with suppliers to ensure business continuity.
  4. Cost Optimization: Implementing strategies to optimize procurement expenses.
  5. Risk Management: Identifying and mitigating potential supply chain disruptions.
  6. Compliance Management: Adhering to industry regulations and company policies.

With the scope of procurement in mind, let’s dive into building and developing your workforce effectively.

Three Practices to Build a High-Performance Procurement Team

The scope of the procurement role is vast, yet it is a primary driver of business continuity. Building the right team is the first step in solidifying this crucial function.

Here are three essential talent acquisition practices that you need to incorporate to ensure high performance:

1. Skill Prioritization

Prioritizing what skills you need during recruitment will steer the productivity of your business. Here are two skill set categories vital to oil and gas procurement:

  1. Soft Skills: Supply chain management heavily relies on communication quality. The talent you choose to onboard must demonstrate strength or potential in soft skills such as strategic communication, project presentation, negotiation, and conflict management.
  2. Problem-Solving Skills: Aside from the experience relevant to achieving your business goals, managing operational and strategic disruptions is part and parcel of the supply chain function. Your team needs personnel who exhibit creativity and resilience in problem-solving and systematic bottleneck management.

2. Strategic Hiring

A business’s workforce development should not be for the short term. As a continuous improvement approach, you must adopt strategic hiring to strengthen your current procurement team and cultivate talent for your future business needs.

Here are two strategic hiring practices to secure high performance consistently:

  1. Strategic Diversity: An effective hiring strategy is hiring to add expertise that your team needs. Whether it’s proficiency in the latest technology or process optimizations, adding a strategic hire will help your team become more diverse and also help improve overall competence through information-sharing sessions.
  2. Talent Pipeline Building: Creating a stream of qualified candidates secures the quality of operations, no matter the timeline. Invest in building a robust talent pipeline through internships, graduate programs, and early career development initiatives. This approach also fosters a positive brand image and long-term talent development.

3. Employee Onboarding

While hiring is key, your onboarding process must help employees integrate into a team from day one. Here are two practices to ensure seamless employee onboarding:

  1. Clear Communication: In addition to vetting your candidate as a fit for your business values, you must incorporate a comprehensive onboarding process to communicate your company culture, organizational processes, procurement system, tools, and expectations.
  2. Sufficient Hand-Holding: To ensure that your new employees reach their full productivity, it is key to guide them during the initial phases. This can be done by assigning a mentor and a two-person buddy system within the team to help them acclimate to the new profile.

With these practices in mind, let’s focus on learning effective talent development for your oil and gas procurement.

6 Pillars of Oil and Gas Corporate Training Solutions

Businesses looking to engineer workforce transformation must focus on the following aspects of training programs:

1. Develop a Relevant Curriculum

Businesses must cultivate a thorough understanding of employee competency levels and align them with the demands of the industry. Businesses can conduct surveys, interviews, and other techniques to execute a data-driven needs and tasks assessment. Identifying the gaps can pave the way for relevant curriculum design and development.

2. Automate the Entire Training Process

Businesses looking to scale their training operations must automate the entire process. On the other hand, smaller business operations can reap the benefits of automation. They can run successful, cost-effective training using lean teams.

3. Build a Digital Library of Superior On-Demand Resources

Oil and gas businesses must invest in building robust digital libraries that provide easy access to on-demand resources 24/7, helping nurture a lifelong learning culture. For instance, adopting a cloud-based Learning Management System (LMS) enables businesses to create, publish, store, and distribute multi-format, accessible learning material securely, seamlessly, and cost-effectively. A well-equipped digital library forms the backbone of any superior training framework.

4. Design and Deliver Personalized Learning Pathways

Today, training programs are moving away from the one-size-fits-all learning pathway. For real transformation and better learning outcomes, businesses must consider making the paradigm shift towards personalized learning pathways. For instance, employees undergoing compliance training in oil and gas can learn the same subject differently based on their proficiency levels, learning schedules, and preferences. Introducing gamification elements such as challenges and rewards can further increase employees’ engagement and motivation levels in their learning journey.

5. Introduce Live Simulations

Building practical skills and knowledge is an important aspect of thriving in a competitive business world. Many employees are thrown into the deep end without access to proper skilling. This approach can result in financial and reputational consequences such as fines and penalties. Instead, businesses can simulate live environments using technologies such as Virtual Reality (VR) and leverage them as learning tools. For instance, a company can run safety simulations in varied conditions, enabling employees to practice in a controlled environment.

6. Leverage Data-Driven Decision Making

Advances in AI-powered predictive analytics enable businesses to make data-driven decisions at every juncture of the training process. They can leverage data to understand engagement levels and employee progress. They can also predict how employees will perform in different conditions and how their progress can be accelerated.

7 Key Sustainable Sourcing Workforce Training Strategies

Below’s a snapshot of how oil and gas companies can make their workforce training strategies robust, high-impact, and cost-effective.

1. Adopt a Digital Training Methodology

Sustainability guidelines will continue to evolve based on ESG needs and goals. Hence, training content and delivery must be consistent and dynamic.

Adopting a digital training approach is a primary way to achieve these goals. Early investments in AI-powered, cloud-based Learning Management Systems (LMS) can enable businesses to develop and distribute training materials efficiently. They can also scale training, boost collaboration, and encourage self-learning.

2. Identify Key Sustainable Sourcing Training Goals

Businesses must identify key learning outcomes that effectively equip employees through targeted workforce training programs to adopt sustainable procurement practices. Once these outcomes are defined, the curriculum design within these programs should be aligned and optimized to support and achieve these sustainability goals.

Business teams must execute training materials and methodology to meet sustainability goals, considering learning barriers, accessibility needs, and geographical concerns.

3. Assess Pre- and Post-training Skills Levels

To help optimize training impact, business teams must thoroughly assess existing skill levels. Knowing where the workforce training program stands regarding knowledge and skills can help businesses deliver the right level of training, identify training outcomes, and define key measurability parameters.

Once the training is completed, participants must be tested on their skill levels to measure training success. Their performance on supply chain sustainability must be monitored and analyzed to determine further training needs.

4. Design a Mobile-First Learning Experience

Today’s learners are shifting towards mobile learning due to its convenience and flexibility. Access to mobile data and a basic smartphone enable a smooth learning experience. However, the learning experience must be optimized for a mobile-first experience, which includes optimization for low or no connectivity.

For instance, participants can easily access multimedia resources, attend live video conferences, and download eBooks and other multimedia resources. Mobile-based learning can nudge participants to engage in self-learning, practice more, and log in from anywhere, anytime, based on classroom schedules.

5. Personalize the Learning Experience

As job roles become more specialized, the tide shifts towards a highly personalized user experience. Hence, oil and gas companies must be able to personalize the learning experience for maximum impact.

Shifting from a legacy LMS to an AI-powered LMS can automate the personalization process. Companies can generate lessons and assessments according to a participant’s unique learning needs and challenges.

6. Enable Building Skills via Live Simulations

While understanding theory and fundamentals is essential, workforce training programs must also focus on enabling employees to apply their knowledge in real-life situations. A key challenge for businesses is preparing teams to respond effectively across various scenarios. Emerging technologies like virtual reality (VR) and augmented reality (AR) are transforming workforce training programs, making them more immersive and impactful in meeting this need.

Businesses can now simulate multiple scenarios and enable employees to practice with diverse parameters. Benefits include a lack of financial and physical risks and unlimited practice within all permutations and combinations.

7. Use Data to Make Key Training Decisions

The measurability of energy sector sustainability training is a crucial aspect of the overall training framework. A superior automated LMS comes with robust AI-based data analytics.

Businesses can track all aspects of participant engagement, analyze trends, and make data-driven decisions. They can also predict participants’ performance based on historical data. Training can be tweaked to suit individual strengths and needs.

Summing Up

The Oil and Gas industry has a long way to go before it can come close to achieving net zero. That said, a well-planned workforce learning and development program can accelerate its progress toward getting there. The key is a cycle of continual improvement.

When it comes to workforce L&D, the right training partner can make all the difference. We at Hurix Digital have over 25+ years of experience and have helped over 250 organizations worldwide with their workforce L&D needs.

With a crack team of over 800 digital experts, we provide industry-specific learning interventions and cutting-edge simulated learning experiences and offer consults to help better your in-house workforce L&D practices.

Get in touch with us to know more.