Our guest speaker last Tuesday was Dr. Priya Marajh who is currently the Manager of Research and Communications at the Energy Chamber, and has a PhD in International Relations. She started off by noting that the situation regarding the oil price crisis is not as bad as the media makes out. Oil & Gas companies were prepared for the current situation with the mantra "lower for longer". They started scaling back non-essential expenses some time ago, with staff cuts being the last resort. At the moment it's mainly contract and temporary staff who have been let go. The large operators like BP and BG (now Shell) have committed considerable funds in the sector. It's the government that now has to follow through to make sure that the the projects happen, and this will lead to more jobs. There are almost 400 service companies in the energy sector who are still doing well and employ a sizeable workforce.
There is a very strong downstream sector (industrial manufacturing plants) but gas curtailment by the upstream operators could mean that these plants are moved to another country. The Energy Chamber advocates diversification within the energy sector by encouraging exporting of our oil and gas services, and several trade missions have been organised to Africa as well as Guyana and Suriname. Our local companies must look for opportunities during the downturn.
The government is consulting with the upstream operators and incentives for investment is being advocated. It's important that we don't create a hostile environment, for example with stringent local content policies. The Energy Chamber has solutions for the unemployed such as training to move into the manufacturing sector which is doing well. They are lobbying for stipends to facilitate this training at the NESC (National Energy Skills Center).
Priya's prediction for a return to reasonable oil prices - early 2017 with a price of US$50/barrel possibly. We shall wait and see. This was a most informative and encouraging presentation.