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ONS 2014: Review – The only constant is change

29th August 2014

After four days of intensive oil and gas dialogue it is time to pack my bags and head home from this important biennial event

ONS 2014: Review – The only constant is change
It is no surprise that the event organisers selected ‘change’ as the theme for this year’s conference

Much has changed in the 40 years since the event first opened its doors. Oil prices have risen and fallen. And risen again. The industry has taken technological quantum leaps ahead – and down into ultra-deep reservoirs.

Major field developments have been replaced by less costly subsea solutions. New business areas and occupational tasks arise, while others have disappeared. Fewer people work offshore, and more of production is managed from onshore operations centres.

At the same time, the world is constantly changing – through democracy processes, industrialisation and war.  Political and financial centres move, and new countries come to dominate the energy stage.

So it is no surprise that the event organisers selected ‘change’ as the theme for this year’s conference. And it has been a topic on everyone’s lips all week. We know that everything changes, so the question is what is around the next corner. Which natural resources will be most in demand?

Early in the show Maria van der Hoeven from the IEA picked up on the theme. “As well as the expansion of shale there are two other things I would like to mention but they concern geographical issues,” she said. “At this moment we see a lot of energy demand growth in Asian countries. But what we can see at this moment is that a lot is going on in sub-Saharan Africa. I would like to emphasise that we need to keep an eye on what is going on in sub-Saharan Africa. The other thing is South America where a lot of new developments are taking place in deep sea exploration. And the same goes for the Arctic region. In both Arctic development and deep sea we have some very real environmental concerns; let’s not forget about that.

“The whole world is watching how that progresses so I do emphasise that our industry needs to work as best it can because that is the best way to guarantee a certain future supply.”

Henrik Madsen, CEO of DNV GL expanded on this topic. “One of the key words in the oil and gas industry this year is change,” he said. “I personally believe that the industry is in for change. We need to provide energy for a growing population and a more affluent population. But we also need to supply affordable energy to bring hundreds of millions, if not billions, out of poverty and we need to do all of this in a way that stays within boundaries. So I believe that in the future we will see heavy duty vehicles such as ships, trains and trucks running on gas, in the form of LNG or CNG and light vehicles running on electricity. This will lower the emissions of CO2 and it will also save very precious oil for more important purposes.

“The oil and gas community and society needs to agree on a long-term target because after all the oil and gas industry is here to serve society. Once we have agreed on the long-term targets we will need innovation, collaboration and we will need smart legislation.”

Another company, Lloyd’s Register Energy, has spent this week at ONS 2014 challenging oil and gas companies to re-think their approach to safety, performance and technical innovation to secure the world’s energy supply in a sustainable way, from reservoir and refinery to beyond.

“According to demographers, the world’s population will reach 8.5 billion people by 2035,” Jason Knights, global communications manager from Lloyd’s Register Energy, said. “These billions of people will need a stable economic environment and sustainable energy supply to meet the needs of a growing population. So where does this leave the oil and gas industry not only to meet the needs for 2035 of a heavily populated planet, but here and now?”

A Lloyd’s Register Energy survey of exhibitors at ONS 2014 revealed more than 44 per cent of respondents consider operating costs to be the primary issue. Technology (19 per cent), Decommissioning (14per cent), Supply Chain (14 per cent) and Knowledge Shortage (9 per cent), were also seen to be important issues. 

Other challenges facing the industry include a continued focus on increased recovery, developing cleaner and more efficient hydrocarbon technology, while work on new forms of energy provision must be stepped up.

At the close of ONS 2014, Lloyd’s Register Energy identified three short-term priorities the industry must address if future offshore assets are to be safely and reliably exploited.

They are: striking the balance between safety critical issues and operational pressures; improving the prioritisation of maintenance so that safety critical areas are addressed and not deferred; and ensuring competence through technology and innovation to help deliver on upcoming energy sources -- maximising economic value and energy security issues.

“The responsibility for ensuring the future of the oil and gas industry lies with each of us – business, academics, regulators and government alike. By working more collaboratively, more intelligently and with a greater vision, then we will all effectively advance the industry’s success – without this collaborative approach we are effectively advancing the industry’s demise,” highlighted John Wishart, Director of Lloyd’s Register Energy.

Lloyd’s Register Energy is committed to working with all industry stakeholders to promote more awareness and understanding of how assets should be managed and certifying new technologies to meet new energy sources and future energy demands.

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