There Are Good Reasons to be Bullish

American Association of Petroleum Geologists (AAPG)

 Clarence Darrow once said, “History repeats itself; that is what is wrong with history!”

At the joint GSA-GCAGS meeting in Houston last fall AAPG held the largest job fair in our history of joint meetings with SEG. Over 400 students attended, and all were excited about the myriad of opportunities in our industry. Many companies exhibited at the meeting looking for new employees.

As I dined with some of the students, I was very impressed with the talent and energy of the group. I was very pleased that the work force initiatives by industry, institutions and associations were starting to bear fruit with a group of excellent new graduates.

Of course, it is the promise of good well-paying jobs that is the main driver – nevertheless, I know that the leadership and committees of AAPG have worked hard to promote our profession and ask more students into the industry.

While some of the students were discussing the competition for jobs, a cold chill of déjà vu went down my spine as I thought about what would happen if there were another downturn the industry experienced several years after I graduated.

In the mid-1980s the huge demand for entry-level geoscientists and engineers dropped precipitously. AAPG’s membership had grown to over 45,000, but it fell abruptly with the dropping price of oil.

Then I realized that the situation today is quite different than when I was a rookie geologist with Exxon in the early ’80s. There are at least three key factors that are different from the industry downturn in the ’80s that promise a good near-term future.

  • One of the key factors is no matter the current price of the oil and gas there is still a critical future shortage of geoscientists and engineers.

The U.S. Department of Labor estimates that roughly one-half of the technical work force will reach retirement age in the next 10-15 years. Industry projections for the personnel required to complete major projects still show a shortage – especially once the economy recovers.

  • Economic recovery is second.

One of the primary differences from the bust of the mid-’80s is the growing economies of China and India, along with the economies of developing countries. Already there are signs that these economic engines are recovering – especially in China. This will once again drive demand for oil and gas and related jobs.

  • The third is the focus on unconventional resources and alternative energy around the world.

In the United States shale gas is a huge resource whose development causes the employment of thousands of geoscientists and engineers. And unconventional plays are not drivers just in North America, as many companies seek to develop these plays with new technology in the many basins of the world.

Geoscientists also have a role to play in alternative energy and environmental applications such as carbon sequestration.

Of course, with any positives there are negatives. In the United States the primary negatives are potential changes in tax laws and regulations. A decrease in the depletion allowance or loss of intangible drilling tax credits could significantly reduce the number of wells drilled – especially by independents –and reduce related jobs.

Nevertheless, AAPG is still bullish on the potential of our profession and the future opportunities for students. To that end, we believe it is especially important to support students and young professionals through this downturn.

One of our first steps in this effort was to collect information.

For this, we developed an informal survey through the AAPG Student Chapters faculty advisers and we conducted a formal poll of women in the work place. In addition, we have polled numerous companies concerning their work force plans. Many of those findings will be revealed and discussed at the AAPG Annual Convention and Exhibition in Denver.

The universities indicated most of their students still had job offers but activity was slowing and some students were opting to stay in school longer. Many of the corporations indicated they had slowed down in hiring, but most geoscience jobs were stable with only a few companies experiencing layoffs.

Our next step is to make sure we continue support of young geoscientists through AAPG programs. These programs include leadership training, carreer support, Grants-in-Aid, travel grants and one of our newest programs – the Imperial Barrel Award (IBA).

As you are reading this column the IBA finals are being held in Denver. Ten teams of students from around the world will compete. Their enthusiasm is absolutely contagious, and it is with that enthusiasm that they will in turn teach us and transform our industry with new ideas and hard work.

The future is still great for our profession – and AAPG will do everything possible to support our members in their search for opportunity.

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Director's Corner

Director's Corner - Rick Fritz
Richard D. “Rick” Fritz, an AAPG member since 1984 and a member of the Division of Environmental Geosciences and the Division of Professional Affairs, served as AAPG Executive Director from 1999 to 2011.

The Director's Corner covers Association news and industry events from the worldview perspective of the AAPG Executive Director.

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