The dust has just settled on Offshore Europe 2017 (OE2017) in Aberdeen, the region’s
leading conference for the oil and gas industry, so now’s a good time to consider some of the key takeaways that came up at the show.
- A return to optimism: we’ve been thinking it as individuals and companies in isolation for a few weeks now. There was a concern that the doom and gloom messages that we heard at OE2015, or the cautious optimism mantra that’s been doing the rounds in recent months, would cast a shadow over this year’s event: but not a bit of it. OE2017 brought together those fragmented voices of hope to generate a unified, strong message for the rest of the world. As BP CEO Bob Dudley said in the opening plenary session: “It’s been tough, but the North Sea is turning things around. There is plenty of life left in the basin.”
- The oil and gas industry is becoming more customer focused: for anyone who doesn’t live within the O&G bubble, this comment might seem strange. How can an industry survive without a complete understanding of its customers after all? In the upstream sector, identifying whom the customer is has often been a challenge in some departments, but we heard time and again at OE2017 that we have to get better at putting the client’s needs at the centre of everything we do. And we saw that commitment filtering through at every level. One senior marketer remarked how even the sales people were becoming more customer focused!
- The digital dilemma: ‘digitalisation’ was one of the top buzzwords at the show, and we heard lots about the need for the industry to fully embrace the adoption of comprehensive digital platforms as part of what’s been termed ‘the fourth industrial revolution’ through the use of cyber-physical systems. One presenter proclaimed that “data was the new oil.” It would be too much of a generalisation to say that the degree of enthusiasm for digitalisation in oil and gas was generational, and many of our clients are proving it is not. But, we did hear of examples where millennial middle management were having challenging conversations with baby boomer c-suite executives about the importance of the digital future.
- We need to get better at telling our story: while increased digitalisation is essential to take our industry forward in this century, we will still need people. Lots of them. One of the really thought-provoking keynote sessions at the show discussed the generation change happening right now, and how we will attract and retain the people as activity picks up. Digitalisation will play a major role in this, but so will helping the world at large understand that the modern oil and gas industry is no longer dirty or dangerous.
- Competing isn’t enough—it’s winning that will make the difference: in the North Sea, we’ve spent the last three years chasing our tail, trying to make sense of it all and responding to what has been a daily set of new challenges. Against this backdrop, just being able to compete with the rest of the world is a considerable achievement. AkerBP’s chair Oyvind Eriksen described how his company had dropped its break- even price from US$62 per barrel to US$35 per barrel, making it competitive with the U.S. shale industry. However, he believes the break-even price can fall to US$25 per barrel. So, we now have the confidence to take on the world once again, whether that’s in boosting our activity at home or exporting our products and services.
Some of the issues above are not new, and just as the industry is cyclical in nature, so can be our responses to the challenges we face. Too often we talk about the same problems and the same solutions and get no further. If we are going to have a successful future in the North Sea, regurgitating old solutions to solve yesterday’s problems has to stop. OE2017 taught us we’re on the verge of something truly great for our industry and our region. Let’s make sure we wring every last drop out of it.
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