Holistic Project Planning: How Work-Force Development Impacts Business Results

Abstract

E&P companies that are trying to meet growing energy demand know that prudent exploitation and replacement of their asset base is critical to long-term success. Supermajors and independents are increasingly depending on an asset base that is characterized by multiyear, multibillion-dollar projects in remote, developing, and technically challenging environments. The planning, construction, operation, and maintenance of these assets, such as deepwater platforms and liquefied natural gas facilities, require holistic project planning and superior execution. A key component of holistic project planning in the frontier areas that in the past has been often underestimated is work-force development. But companies that take a disciplined approach in this area achieve: - Improved alignment with the host government. - Lower operating costs. - Higher return on their investment. So, how does work-force development fit into a holistic project plan? What is it, and how does it deliver business results? A New Opportunity Holistic project planning synchronizes the various asset development, operating, and work-force strategies to optimize each phase of the asset life cycle. Over the past several years, both through experience and because of the size of the investments as well as the production-deferral implications, operators have become increasingly proficient and focused on planning and executing the development of assets in frontier markets. Project management, risk management, supply chain, and logistics processes are being adapted to the challenges presented by frontier development. As projects have grown into the multibillion-dollar range, the work-force development strategy represents an increasing area of risk and opportunity. The strategy traditionally used by operators relied heavily on expatriates. But times have changed, and operators are facing aggressive local content targets. Using a national work force is no longer an option; it is a requirement. It is also a major challenge. The national work force in frontier markets oftentimes does not have the technical capabilities and management skills required to operate and support today’s increasingly complex oil and gas operations. Operators must determine how the national work force can be developed effectively to sustain their operations.