By ManUp Services
The COVID-19 pandemic pushed oil prices to a historic low in April when futures fell below zero dollars, kickstarting a new normal for operators and service companies going forward, or at least till the pandemic is contained.
Previously forecasted gains for 2020 have been hugely eroded as E&P companies are set to lose a whopping $1Trillion in revenue, according to analysts at Rystad Energy.
The social distancing guidelines and associated lockdown measures have thrown up operational limitations for exploration and production companies. Upstream operators are constrained to introduce measures towards protecting employees, particularly those working on remote facilities.
To contain the spread of the virus, offshore workers must balance maintaining social distancing while living and working in relatively confined spaces.
“Rigs, offshore production platforms, and other production facilities among others have generally reduced personnel aboard to avoid overcrowding”, says Isaac Ebhohimhen, Measurement & Allocation Manager, Aiteo Eastern Exploration and Production Company Limited, a key Nigerian operator. “This process reduces the chances of spread of the pandemic”.
To further ensure the health and protection of workers, companies have now adopted an extended work rotation from 14 to 28 days to reduce the likelihood of spread via frequent contact. This means that any personnel scheduled to go to the field is first quarantined for 14 days for close monitoring before certified fit to go to the worksite by a medical officer. Furthermore, projects not critical to oil & gas production have been suspended and non-core-crew members are unauthorized to mobilize to site except absolutely necessary or critical. This is to prevent the possible spread of the virus from outsiders to site-based personnel. Oil companies have deployed additional medical officers to production facilities for continuous personnel monitoring and early detection of signs and symptoms of the virus. Additional Personal Protective Equipment (PPE) has also been deployed to site for medical & work personnel. More importantly, as adopted by oil majors, medical facilities offshore have been upgraded to manage COVID-19 in the event of an eventuality.
Beyond protective measures being put in place for the safety of staff, the need for social distancing has also disrupted the normal flow of work as most oil companies are still working remotely while they figure out what changes need to be made in their office configurations. Since fewer workers are present on location, field personnel have to work longer days resulting in work-related stress, which has heavily impacted the speed and efficiency of operations, while movement restrictions on operational bases have introduced supply chain constriction and difficulty. In the light of travel restrictions, work activities that require expatriates have been suspended while office resumption plans contemplated by most operators post lockdown, is for departments to be divided into two groups working on two-weekly rotations to ensure social distancing. Despite the new normal in working conditions, companies, determined to keep operations running have adjusted to working from home and employees have reported issues such as having to work longer days, the pressure to remain productive amidst domestic distractions, discomfort due to lack of office type infrastructure, poor internet facilities, limitation due to lack of work tools like printers, scanners, etc.
So far, COVID-19 has remained resilient and continually portends a potent threat to lives and livelihood. National corporations such as the Nigerian National Petroleum Corporation are faced with a double whammy scenario; OPEC imposed reduction in production coupled with increased direct and indirect costs associated with battling the pandemic have directed operators to reduce operational budgets by 40%. This has severe implications such as drastically reduced activity and attendant diminished demand for oilfield personnel. Experts who spoke exclusively with ManUp believe that loss in man-hours would be regained with ramped-up demand in personnel and projects when activities pick up.
Optimism has never been an effective strategy to weather the severity and impact of operational slumps in the industry, rather, every downturn presents an opportunity to re-tool and adjust operating models to align with the prevailing realities of the time.
ManUp services are organized to alleviate the operational difficulties imposed by budget reductions availing service companies access to a platform, where a fast growing pool of skilled freelance oilfield personnel can be sourced quickly and competitively.