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Petroleum Engineering

Despite the recent instability of oil prices resulting from the latest Iraqi crisis, the long-term outlook for employment in petroleum engineering is as strong as ever.

By Shayna Sobol

Despite the recent instability of oil prices resulting from the latest Iraqi crisis, the long-term outlook for employment in petroleum engineering is as strong as ever. Historically, petroleum engineers have been in short supply in the marketplace, save for a couple of instances when oil companies felt the need to downsize due to a temporary oversupply of qualified staff.

"Today, there aren't enough of us to go around," proclaims Dr. Craig Van Kirk, professor and head of the petroleum engineering department at the Colorado School of Mines in Golden. "The job market is excellent, salaries are the highest among all engineering fields, and oil and service companies are looking over the long haul to determine their staffing needs."

With average starting salaries hovering around the $50,000-a-year mark, students working toward their bachelor's degree in petroleum engineering can look to fruitful careers ahead for motivation. They can also share the excitement of the industry with veterans like Van Kirk, who as a student, industry professional and now educator, has been immersed in the field for more than 25 years.

Important But Often Overlooked Discipline

"It's an interesting field that is so important internationally, as well as to the economic health of the U.S.," notes Van Kirk, whose involvement in petroleum engineering has taken him all over the world, to destinations spanning from Baghdad to Babylon and Southeast Asia to South America.

"This area isn't well-advertised in America," notes Van Kirk. "Many kids coming out of college haven't even heard of petroleum engineering. The same is true for mining and metallurgical engineering."

Colorado graduates aren't the only ones who can rest assured of job opportunities in the coming months and years. The same holds true in Texas and Oklahoma, according to professors and department heads at top petroleum engineering programs there. "This spring's graduates were all hired before January 1st arrived," reports Dr. Roy Knapp, interim director of the School of Petroleum and Geological Engineering at the University of Oklahoma in Norman. "Many students chose from among three to five offers with very good starting salaries."

Dr. Chuck Bowman, head of the petroleum engineering department at Texas A&M University in College Station, says the outlook for graduates there remains strong, though, he says, "there did seem to be some doubt creeping into employers minds" due to the drop of oil prices recently experienced nationwide.

Oil Prices Drive Industry

"Historically, in my opinion, just about everything that has affected industry employment over time has been related in some way to the price of oil," notes Bowman. "Through the late 1980s and into the '90s, we saw the creation of much flatter organizational structures here in the U.S. We also saw some reductions at the staffing level.

"At the same time," Bowman continues, "new technologies have created a growing requirement for young, technically trained individuals. "Knapp at the University of Oklahoma shares a similar view. "Capital investment in the industry is high and is looking to grow even more, though that was somewhat clouded recently by low oil prices. Energy-use growth around the world is increasing by about 4 percent annually, however, so even if we have temporary excess capacity, that will be used up in a year's time.

"There is a pent-up demand for mega-projects, as well," adds Knapp. "To be able to design and implement these kinds of projects you need a large supply of engineering skill."

All of these factors bode well for job opportunities in petroleum engineering presently, in the near future and well into the millennium. "Companies know that they have to plan well beyond today," says Van Kirk of the Colorado School of Mines. "They're not just planning for next year, either. They're looking at the number of petroleum engineers they'll need two, five, even 10 years from now."

New Technologoies Broaden Opportunities For Grads

And with the kinds of technologies coming to the foreground, things are bound to get more and more interesting in the next several years. All three professors cite directional or horizontal drilling as a leading-edge technology affecting employment. They add the area of 3D and 4D seismic technology as spurring growth in the industry, as well.

"The ability to achieve high-directional angle drilling is fairly new and it's allowing oil companies to do more than they could even 10 years ago," explains Van Kirk.

Bowman of Texas A&M says horizontal drilling has been used widely in the region, where the ability of oil-bearing rocks to produce is limited because of restricted permeability. "Drilling horizontally creates more flow area, making an economical project out of something that otherwise wouldn't work," he says.

Another noted technology impacting the industry, according to experts, is reservoir management. Bowman describes it as "using very sophisticated mathematical modeling techniques coupled with the 3D seismic pictures of underground reservoirs to do production simulations." He says this allows engineers to come up with the best ideas of where to put wells. "In theory," he notes, "we've known how to do that for a long time. Until recently, however, computers were not powerful enough to handle this complex level of mathematics."

As middle-size and even small companies begin to increase their use of such technologies, they, too, will be a more powerful force in the employment picture. "Many of these companies used to just seek five- to 10-year veterans looking to make a change from the majors," says Bowman. "Now they're looking increasingly to hire young graduates whose familiarity with cutting-edge technologies is strong and up-to-date."

Smaller Companies Heat Up Competition

Bowman reports that while the traditional recruiters from major and semi-major oil companies, or from service industry firms such as Schlumberger continue to seek Texas A&M graduates, other employers have recently come on the scene. "Some of the more aggressive recruiters right now are the independents, such as Apache, Burlington Resources and Union Pacific Resources," Bowman says. "Also, some much smaller but very sophisticated operators are coming to us, even if they need only one new person a year."

Van Kirk gives a similar view of recruiting activity at Colorado School of Mines, where major oil companies and service companies continue to hire petroleum engineers. Add to that the "couple thousand or so smaller independent oil companies you've never even heard of, as well as consulting firms, government agencies and environmentally focused companies looking to hire," as Van Kirk explains, and the picture is brimming with possibilities.

At the University of Oklahoma, Knapp explains that his view of the recruitment picture has changed dramatically just in the last couple of years. "It's worth noting," he says, "that two years ago, the people who hired our graduates were close to evenly divided into major international oil companies, independent operators and service companies.

"But now," he continues, "because the major international companies are the ones who are able to embark on the mega-projects I mentioned earlier, they are back and they are so sophisticated at recruiting, they tend to dominate the picture. Likely three-quarters of our current graduates will go to work for majors such as Mobil, Exxon, Shell, Chevron, you name it."

Shayna Sobol is a freelance contributor to Graduating Engineer & Computer Careers magazine.

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