Professional Documents
Culture Documents
US$950,000,000
Financial Adviser May 2011
US$1,106,000,000
Financial Adviser February 2011
Undisclosed
Financial Adviser July 2010
US$210,000,000
Financial Adviser February 2010
US$600,000,000
Senior Notes Offering due 2019
315,000,000
Convertible Bonds
US$650,000,000
Senior Notes Offering due 2020
US$1,100,000,000
Senior Notes Offering due 2020
rbccm.com/energy
This advertisement is for informational purposes only. RBC Capital Markets is a registered trademark of Royal Bank of Canada. RBC Capital Markets is the global brand name for the capital markets business of Royal Bank of Canada and its affiliates, including RBC Capital Markets, LLC (member FINRA, NYSE and SIPC); RBC Dominion Securities Inc. (member IIROC and CIPF) and Royal Bank of Canada Europe Limited (authorised and regulated by FSA). Registered trademark of Royal Bank of Canada. Used under licence. Copyright 2011. All rights reserved.
Guest Foreword
A Special Partnership
Foreword by Ross Stewart Campbell, CEO, The Oil Council
The dust has now settled on our hugely successful inaugural Assembly looking at the state of play in the global oilfield services sector. In reflection I also took the opportunity look back at where The Oil Council has come since its inception in late 2009. Since then much has changed within our industry, as it has the wider world in general. We started off as a London based venture looking at engaging E&P companies with their peers and the wider finance and investment communities. In 2010 we opened up an office in Cape Town to reflect the growing importance of the region to our Partners and Member Africa seeing the greatest increase in global E&P investment in 2010. We are forever grateful to those friends that have supported our endeavours, championed our efforts and invested their time, energy and capital within our organisation. Aristotle said that friendship is essentially a partnership. It is with this in mind that I am very excited to announce the opening of our New York on August 1st. We are opening our US office to enable us to better serve our North American network and to reflect the growing importance of the regions E&P sector for foreign investors. We have named Vikash Magdani, Executive Vice President, to oversee this new office. Vikash will spend much of the summer reaching out to our Members and Partners and putting to the test the theory that Manhattan is said to be 11 miles long and 2 hours wide! So what lies ahead? Let me refer to our primary objective: Delivering real insight into how the current financial, economic and investment landscapes are interlacing and interacting with the oil and gas industry and highlighting the business challenges and opportunities they present to oil and gas professionals. Over the next 12 months we will host receptions, dinners and large scale events not only in London, Houston and New York but also Bogota, Paris and Aberdeen. We are growing our team to ensure we engage more with our growing network as more and more executives wish to benefit from the insight our network produces and the business opportunities that lie within. These are interesting times, these are challenging times, these are busy times but these are memorable times. Later there is an article by Kevin Kerr detailing his thoughts on Industry Partnerships, which was one of the key themes that entwined last months Assembly. Building on Partnerships is the very foundation of seizing the greatest opportunities in tomorrows market. Partnerships are what The Oil Council is built on. For example to host Junes Assembly we joined forces with over 50 industry partners including: Aker Solutions, Archer, AXA Framlington, Arle Capital Partners, Capital International Research, Energy Intelligence, Energy Ventures, Evolution Securities, Expro Group, Fairfield Energy, First Reserve, Fox-Davies Capital, Gulf Investment Corporation, Halliburton, HSBC, HSBC Asset Management, Intervale Capital, ITF, Kentz, Lime Rock Partners, MOL Oil & Gas, National Oilwell Varco, Newton Investment Management, OFS Portal, Petrobras, Petrofac, Promon Engenharia, RBC Capital Markets, RCM (Allianz Global Investors), Regester Larkin, Schlumberger Business Consulting, Schlumberger SIS, Senergy, Simmons & Co, Statoil, Subsea 7, Trican Well Services, Well Innovation and Wood Group (JP Kenny). In the future we will only look to strengthen our industry ties and in doing so the ties between our network. Finally, if you havent taken the opportunity to do so, please sign-up to become a Member of The Oil Council. This will give you exclusive access to our closed networking events, as well as, a community of over 70,000 industry executives. The opportunities are abound, so I encourage you all to join the most exclusive network in town if you havent already done so. Yours,
Oil & Gas Company Executives Register Today for only 1,795! Special Industry Delegation Discounts Also Available!
Featuring some of the industrys most influential minds, including:
Abdul-Jaleel Al-Khalifa CEO, Dragon Oil
Oil Council
WORLD ENERGY CAPITAL ASSEMBLY
Welcoming A New World Order: Defining the Roadmap for Future O&G Finance and Investment
Patrice de Vivis Senior Vice President, Northern Europe, Total Exploration & Production
Lead Partners:
Partners:
Toronto Stock Exchange TSX Venture Exchange Toronto Stock Exchange TSX Venture Exchange
Toron Excha
Bourse de Toronto
Bourse de Toronto
Bours Toron
www.oilcouncil.com/weca
www.oilcouncil.com/awards
info@oilcouncil.com
Special Article
Nations are striving to achieve higher standards of living in their continual race for economic development. They aim to migrate from a simple, low-income economy to a modern, high-income economy. They leverage natural resources and unleash their intellectual capital to sustain the growth of their Gross Domestic Product (GDP) and create the jobs necessary to meet the needs and aspirations of an expanding young generation newly entering the job market. There is no secure position in the global development race. Developed countries such as Japan, Western Europe and the United States of America, aim to maintain their leading economic position. Developing nations, including emerging economies such as China, India and Brazil are making great strides into the world economy. Many other poor underdeveloped nations simply aspire to meet a minimum acceptable standard of living, including health, education, food and shelter. Petroleum producing countries in the MENA region continue to rely on producing and selling oil and gas to fund 90% of their fiscal budgets. The focus has been to maximize the dollar value of the petroleum sales revenue a gas station business model. Refining and petrochemical industries add incremental value to the bottom line, but they are also dependent on the same limited petroleum resources. These industries, too, are not labour intensive, thus not enough jobs are created for the young generation. Except for contributing petrodollars revenue to the national finances, the petroleum industry did not directly help to develop the local economy. Before countries run out of their limited oil and gas reserves, there is an urgent need to diversify their income by investing into their local economies. This will in turn accommodate millions of young people entering the job market. This can be achieved through transforming the petroleum industry into an industrial base business model focused on developing the local economy on a wider base. But why had the petroleum countries in the MENA region adopted the gas station business model in the beginning? Historically, the petroleum industry has originated in the MENA region by International Oil Companies (IOCs). They had their operation bases in this region supported by their global supply chain and headquarter offices, based in their home countries (United States of America, Europe, and Japan). IOCs were an essential part of the free market economy. The proceeds of crude sales, given by the IOCs to the producing countries, contributed the vast majority of local economies. Therefore, most MENA producing countries had adopted the free market economy as their role development model. They had liberated trade, opened borders to imports, pegged their currencies and sold their hydrocarbons in US Dollars, and invested most of their savings in Western economies including treasury bonds, equities and real estates. They continued to set their petroleum production strategies to meet global demand, including production level and spare production capacity. The climax of this shining free market economy was during the fall of the Berlin Wall and the collapse of the Soviet Union in 1989. Two decades after, this model started to slowly fade away even within the Western hemisphere. Unlike the sudden physical destruction during World War I and II, which wiped out decades of developments in few years, the current economic meltdown is taking more time, but has unfortunately started to cause a serious social and political crisis. Symptoms of such failure are obvious in Greece, Spain, Ireland and Portugal. Japan and the USA are also sinking deeper into debt and budget deficits. This does not imply that these economies are destined to fail, but they are definitely losing their once rosy historical attraction. Since the 1980s, in some countries, National Oil Companies (NOCs) started to assume operatorship of the oil and gas resources on behalf of their sole shareholder, the government of the country. In other countries, International Oil Companies (IOCs) and other independents retained operatorship according to modified production contracts but with more emphasis on increasing local content. Most operating companies in the MENA region have successfully increased the local content of their manpower to a high level. However, due to easy access to the free global market, operating companies had no urgency to localize the supply, services and contracting part of the industry. Instead, they continued their historical trend of awarding most of the petroleum services and major Engineering, Procurement & Construction contracts to dominant global contractors. They procured most of the equipment and spare parts from global suppliers in USA, Western Europe, Japan and China. As a result, billions of dollars and hundreds of thousands of jobs continued to leak across the borders of the MENA region. This free market policy had been very successful in sustaining higher oil and gas production targets with time, but had miserably failed to develop the local economy. With a global talent pool and industrial bases in Houston and other hubs, the free market had cultivated a gas station business model in the MENA region, aiming to maximize the bottom line of crude sales revenue; i.e. the focus was on exploration and production, refining products for the local market and crude sales for international markets.
Special Article
There was no focus on establishing a local industrial base in the MENA region to support the petroleum industry in the presence of a vibrant global support network. As a result, after more than sixty years of petroleum production, the region remains completely reliant on external suppliers and contractors. While operating companies have a 90% local employee base, the domestic content of their major suppliers and contractors is lagging behind at barely 20 % level or less. The MENA producing countries have produced approximately 250 billion barrels of crude oil since inception, with approximately 500 billion barrels of oil reserves remaining to be produced in the future. Some producers have reached peak production and started to decline already, while others continue to sustain or increase production, but will definitely peak and start to decline in ten to twenty years. In 2011, the oil and gas revenues in the MENA region will be close to one trillion US dollars. While one hundred billion US dollars, just 10%, will be spent on petroleum industry projects, the remaining 900 billion US dollars will fund the fiscal budgets of the producing countries. If the local content is carefully enforced, (incrementally increased over a few years from the current 20% level to the target level of 80%), the 100 billion dollars spent on the industry projects has the potential to create half a million jobs for young graduates and can add an incremental gain of 500 billion dollars to the GDP of the region, assuming that each US dollar spent in the local economy will generate a five dollar gain in the GDP. Most importantly, it will help establish a permanent industrial hub, housing corporations that can support the global petroleum industry. Further, from this hub, other businesses and services will inevitably spawn, adding growth and resilience to the local economy and broadening the opportunities for young people and their families. The region needs to establish as many Samsung Group lookalike corporations as possible to support the petroleum industry. Samsung Group, for example, accounts for about one fifth of South Korea's total exports. In fiscal year 2009, Samsung Group had generated revenue of $172.5 billion, with net income of $ 13.8 billion. Samsung total manpower in 2009 was 276,000 employees. Samsung had embraced their in-house talents and technologies to generate jobs and bring prosperity. Leadership in petroleum producing countries and senior management of operating companies together needs to enforce a gradual increase in the local content of all support, procurement and services contracts from the current 20% level towards a target level of 80% and more. Operating companies need to audit all their subcontractors to ensure full adherence to local human development plans, including advanced training and adequate remuneration; as well as procuring most of their services, engineering and construction needs from domestic markets. This will certainly help incubate and nurture domestic corporations that can position the region as the global hub of technology and innovations. These corporations will transform the petroleum industry from a gas station model into an industrial base model. This high priority task should be first and foremost on the agenda during the coming few years. If the MENA region does not leverage the oil and gas resources to bridge the gap and jump on the economic development wagon, it will be too late and the consequences could be alarming.
Dr. Abdul-Jaleel Al-Khalifa is currently Chief Executive Officer of Dragon Oil. He served as the 2007 President of the International Society of Petroleum Engineers. He served for twelve years as Manager of Reservoir and Exploration Departments in Saudi Aramco. He is a PhD graduate at Stanford University in Petroleum Engineering. Dragon Oil is an independent international oil and gas exploration, development and production company. Our principal asset is the Cheleken Contract Area, in the eastern section of the Caspian Sea, offshore Turkmenistan. The Groups headquarters are located in Dubai, UAE. Dragon Oil had proved and probable oil reserves as at 31 December 2010 of 639 million barrels of oil and condensate, 1.6 trillion cubic feet of gas reserves (corresponding to 260 million barrels of oil equivalent) and 1.4 trillion cubic feet of gas resources.
Editors Note: Abdul-Jaleel Al-Khalifa is joining our World Assembly as a Keynote Speaker in London between 16-17 November. He will be speaking alongside other industry leaders including: Lord John Browne, Ian Springett, Christof Ruhl, Jeffrey Currie, Mike Watts, Patrice de Vivis, Abby Badwi, Jonathan Swinney, Kevin Hart, Alan Booth, Bill Transier, Keith Roberts, Alastair Beardsall, Paul Atherton and Alan Stein to name only a few.
Special Article
Strategic Alliances... In the Brave New World of Energy, Partnerships are Key to Success
Written by Kevin Kerr, CEO and CIO, Kerr Trading
At the start of this year, more than a dozen U.S. and Chinese companies announced plans to jointly develop and sell cleanenergy technologies, demonstrating collaboration in an industry that has been a source of competition for the two countries. The partnerships, involving Alcoa, Duke Energy, China Power Investment Corp., Shenhua Group Corp. and others were announced in early January. It took place during a forum promoting energy partnerships between the U.S. and China. The event was business and political, rarely in the global energy sector are the two not connected these days. The deals were also unveiled on the day China President Hu Jintao arrived in the U.S. for a four-day visit. U.S. and Chinese officials have sought to collaborate on clean-energy projects for decades, given both the U.S. and Chinese global appetite for more energy, and the search for greener fuels and technology, to combat harmful air pollution. However the overriding factor on everyones minds right now is primarily toward economic growth and security, as the world looks to bounce back from financial meltdown.
Dragon Metals
If green technology is the future of clean energy than rare earth elements are the primary input. China's stranglehold over rare earths, especially the heavy rare earths, is a major concern. Chinese control over the world's rare-earth metals has many experts worried; mainly because they are i used so much in clean-energy products. The panic button was pushed suddenly again and has prompted U.S. officials to call for diversification of supplies, but no matter what the rest of the World is far behind China in this arena and there may be many more environmental struggles ahead in development of more rare earth production. Future partnerships on the rare earth front with China seem unlikely. Only time will tell. You can view a video interview I did with the CEO of Silmet, now Molycorp-Silmet, in Estonia. Click Here In the video from December of 2010, I take a tour of the production facility and interview the CEO David OBrock. Prior to their purchase by Molycorp. A Brave New World of Energy As costs for raw materials, R&D, exploration, and more, grow rapidly, strategic partnerships will be the keys to long lasting profitability and growth. Without that partnership cushion, certain players will simply have to shut down or be absorbed in the increasingly competitive energy landscape. The world of energy is changing rapidly and the race will go not necessarily to the swift but to the bold and more importantly, the intelligent partnerships.
About the author Kevin is a TV and radio investment advisor, his unparalleled expertise in futures and commodities has made him a regular contributor to news outlets like CNBC, CNN, FOX News, CBS Evening News, Nightly Business Report and many others. Recently, he was even featured on Jon Stewart's The Daily Show. What's more, Kevin has traded commodities professionally for the last 23+ years. Kevin began his career on Wall Street in 1989 acting as a currency arbitrage clerk on the former New York Cotton Exchange and has worked on and owned seats on several of the Commodities Exchanges in North America. Kevin is Editor of Kerr Commodities Watch and a contributing Editor at Weiss Researchs Uncommon Wisdom Daily. For more information on Kerr Trading visit: www.kerrtrade.com
arle is a new private equity partnership engineered for a new era, founded on a strong track record, far reaching networks and a commitment to partnership.
Highly focused and committed to the pursuit of operational efficiency, arle has built a reputation for taking an active approach to ownership and partnering with the strongest business leaders. We currently manage investments with a combined enterprise value of 10bn. talk to arle today and find out what our oil and gas experience and expertise aibel, expro international, stork technical services, Wellstream and vetcoGray could mean for your company.
in the first instance please contact John arney or Mark dickinson: arle caPital Partners 12 charles ii street london sW1y 4qu e info@arle.com www.arle.com
IMPORTANT NOTICE: Arle Capital Partners Limited (Arle), authorised and regulated by the Financial Services Authority, acts for the funds that it manages (the Funds). We are required by our regulator to clarify that Arle will not be acting for anyone else. In particular, Arle will not advise potential investors on subscriptions in any Fund or co-investments and will not arrange transactions on behalf of anyone other than the Funds or provide advice on the merits of such transactions. No representative of Arle has the authority to represent otherwise. Arle is not responsible for providing you with the protections afforded to its clients and you are strongly advised to take your own legal, investment and tax advice from suitably qualified advisers.
www.petrofac.com
It was suggested that perhaps this is because when the times are good, the impetus to invest in expensive technology is not perceived why mess with success? And when times are bad and the price of oil is low, investing in new technology is not economically viable. The oil industry has more extreme cycles than other industries and doesnt spend as much time in between its two extremes long enough for a sober reflection on the merits of adopting new technology. Another factor hindering technology uptake in the industry is that the sheer diversity of production methods. Every well is different and presents its own set of challenges and solutions. This sheer diversity mitigates against the widespread adoption of any single technological innovation. It is astonishing, as was noted, that globally, an estimated 19% of all wells are shut in due to integrity issues, resulting in a loss in profits of $1bn a day. Imagine if the airline industry were satisfied with only 80% of their planes taking off and landing. The oil industry really lags behind here. Automation and technology cannot, of course, eliminate human error which is always a part of the industry, and it cannot make the business of oil and gas risk-free. The recent and influential NY Times article on the dangers of fracing turned out to be based on a number of outdated misconceptions and old data, but shows just how prevalent the negative perception of E&P is. The industry is baffled by this, and by drilling moratoriums, France and New Yorks ban on fracing etc. And yet, the panellists were unanimous that the industry is losing the public debate on fracing. It is an uphill struggle to try to appease the public about the safety of its production methods because assurances are unavoidably perceived as self-serving.
Looking forward to the next 6/12 months, do you feel confident? I would say generally speaking it does appear to us that there is going to be significant investment for the next three to five years at the very minimum. Clearly with the disruptions weve had this year, with Libya and the fact that there really is no spare capacity outside of Saudi Arabia and the Saudis themselves have been very much concerned about that issue and are putting significant capital to work and bringing more rigs into the country. In terms of broader themes, a key one is a major structural shift back to oil drilling in the US market and right now, approximately 60% of the rigs drilling in US are for oil. Youd have to go back at least 20 years to get that same kind
Kentz, setting new standards and delivering innovative solutions to energy clients worldwide
www.kentz.com
of ratio and these are not short term, cyclical moves these are long term structural. Some may have forgotten for the 10 year period between 99 and 2009, 80% of the rigs operating in the US were built for natural gas. Im also cautiously optimistic on the industry, the industry is cyclical but I do think there are sub-sectors where there are good growth rates and opportunities: deep-water markets, the offshore construction and certain areas onshore and in the shale markets and the oil drilling, and also in horizontal drilling. The biggest problem that we have in the UK is that we can all get very excited about oil drilling, horizontal drilling, shale and this kind of stuff but when were investing, if you look at the UK oil service sector, its dominated by huge engineering & construction companies and project management companies that dont have anything to do with that. Its a difficult conundrum and you can talk about deep-water drilling, say Thats fantastic, but we dont have any exposure there either. Its a real problem, the sector in the UK is too thin and even if you take it across Europe youve really got to go up into Norway before you start finding areas where you can really invest and exploit the sort of opportunities that probably everybody across the panel thinks are going to be interesting places to go. I am not optimistic - I think there are a lot of issues that are starting to emerge that are going to put some dampeners on the industry. in particular, if you look from the E&P side, access to acreage of reserves is becoming a big problem. Also there's the fiscal take from governments, just look at the deal on the UK jacking up rates in the budget, there's starting to be a domino effect coming through.
What are the key indicators used to value todays OFS stocks?
On the E&P side, I think youve got the same usual metrics, i.e. looking at DCF, asset prices and get a valuation of what the fundamentals are but the big question mark is - whats the exploration upside? A lot of people adopt the risked exploration approach and I find that worrying because companies tend to up the potential size of the target to the upper limit, they also tend to de-risk it in their minds. That does create some concerns for me about how some of these companies in the market are valued, some of which have got significant market capitalisation just on a bunch of licences in the sea, with no experience out there. In the oil service sector its all about forward multiples and you can re-invent the wheel if you like but EV/EBITDA and PE/Multiples is all you need. People talk about DCFs but it doesnt mean a thing, certainly not in the cyclical business because everything is in a terminal value and if youve got a cyclical business, what is the terminal value? I think the only way to look at it is to weight those methodologies, putting more emphasis on the earning methodologies as opposed to the DCF methodology, but valuation is in the eye of the beholder. Generally speaking weve seen a greater propensity of investors starting to use a DCF. I would generally still agree in terms of the usefulness of that but nevertheless, we need to be aware of what our investors are looking at. Multiples have compressed pretty radically over the course of the prior five year period. We look at data going back 10/15 years, as far back as we can get it, and the multiples have started compressing significantly around the 2005/2006 time period.
Should we be using similar multiples as in the past, given the maturing industry?
Obviously the multiples are lower reflecting the value the industry has gone ex-growth and weve just got to live with that. If you go back to, say, 1995 through 1997 and probably spread out into 2000, investors were getting re-acquainted to the oil field services sector after what was an industry depression for almost 20 years to the point that you couldnt get investor attention by talking about an oilfield services stock. So all of a sudden, with the capacity absorption and pricing power, the initial investor back into the space was definitely a growth investor and the multiples reflected that. After two subsequent cyclical rollovers in 1999 and again in 2004, investors started looking at services not a growth business, this is a cyclical business. Thats when we started to see some transition to looking at a DCF analysis and if you look at the oil field drilling space specifically, the multiples collapsed from something around the 15 to 20 fold to more like 5 to 10 fold. My perspective is - I deal with the most recent 5 year history and if something looks pretty attractive on that then its going to look even more attractive if multiples expand.
Wherever you need greater efficiencies, Halliburton delivers them in greater numbers.
Solving challenges.TM
2011 Halliburton. All rights reserved.
HALLIBURTON
Service companies are getting a larger and larger slice of the technology and value chain. Someone showed a very interesting chart earlier which showed effectively the variation around the sector average and Ive seen enough cycles where you can see the whole sector moving around the sector average with peaks way up in the high 20s and trough down in the single digits. Its really interesting to compare where we are now against that long term trend. The long term average happens to be around about 15 but at the beginning of the year we were slightly above it and now weve drifted off below it. It is a cyclical business, you dont know when the cycles going to shift. Everybody says theres great visibility through 2011 and 2012 and maybe up to 13 but what happens after weve got no idea.
How do you factor in the NOCs as a change to the dynamics of the industry?
Generally speaking, the level of information you get on a customer specific basis makes this almost impossible. However, theres been a fair shift to the level of spending on the NOC front and what it means for the revenue base for oil field service companies. I think that means theres going to be more stability and probably less volatility in the overall revenue stream. This is obviously the factor that has to be built in when one is looking at your recommendation and view on the stock. You try to get a balanced view of the competitive position of the company and its relationship with the NOCs and the IOCs is particularly important. So ideally ones looking at a company that has good relationships with both those types of companies. I think partly it comes from geography. If youre very OECD-centric business. the chances are your relationships with IOCs are going to be far less than if youre in the MENA region. I think it comes back to a very fundamental point as to why the oil services is probably a better place to be than an IOC because your global universe is actually getting bigger, not smaller. Weve heard today about the IOCs and how difficult it is to gain access to resources, whereas the oil service companies now maybe were indirectly involved with NOCs, now theyre directly involved with NOCs in a much bigger cake, so the cake, as far as the service business, is getting larger so its down to geography really.
Hugh ODonnell, CEO of Kentz (far left) with some of the Kentz team and industry partners
www.senergyworld.com
Were listening
Partnership based on a close working relationship Senergy continues to grow its international energy business, delivering integrated services to clients in the oil and gas and alternative energy sectors. Through the application of commercial and technical innovation we add value and minimise risk - and ultimately enhance performance and productivity. With over 500 people bringing an unrivalled breadth and depth of expertise together to challenge convention, Senergy gives you the right assets, the right team, the right solution and the right results.
United Kingdom
Norway Middle East Malaysia Australia New Zealand Americas Software Training
Our keynote finance speakers share a joke on stage: from left to right Terry Newendorp Chairman and CEO, Taylor-DeJongh Mike Beveridge, Managing Director, Simmons & Co Greg Herrera, Partner, Energy Ventures Tim Chapman, Managing Director, RBC Capital Markets James McCallum, CEO, Senergy Simon Crowe, CFO, Subsea 7
Neil Hartley from First Reserve shares with our audience his firms investment strategies
"This first Oil Council event focused on the service industry was not only timely, but it made us think why we had waited so long. These are the companies that actually do the work, that face the challenges head-on in the field, and that provide much of the technology and innovation in our industry - and it showed. What came across was the vibrancy, passion and commitment of each company represented in an event superbly organized by The Oil Council team" Lew Watts, Non-Executive Director, Regester Larkin and former EVP, Halliburton Thanks for the opportunity. It was great to see the event very well attended and engaged in the relevant topics presented. Brady Murphy, Senior Vice President, Europe and Africa, Halliburton
Regester Larkin Energy is an international energy consultancy that advises companies operating and serving in the energy, extractive and related industries to earn, maintain and expand their license to operate. We advise the senior management of supermajors, national oil companies (NOCs), large independent oil & gas companies, utilities, service and extractive companies. We also help investors, insurance companies and other financial institutions evaluate the above ground risks of proposed energy sector projects and deals.
Providing expert counsel in: Business intelligence and insight Strategy development Policy and positioning Strategic communications Crisis management and emergency response Assurance and assessment
200 executives joined us for what was a memorable, fun-filled Summer Dinner
Award winning comedian Danny Buckler headlines the Dinner as Guest Entertainment Act
The event gets a good mix of people together who have interest to talk to each other, The Oil Council provides this and has managed to create an excellent event. The talks and presentations were of interest and kept all of us awake and participating John Boogaerdt, Senior Advisor, Schlumberger Business Consultants Thanks for the opportunity to show some highlights of Petrobras to such a senior audience, it was a very interesting event, well organized and well attended indeed Tony Piazza, Senior Exploration Manager, Petrobras A remarkable and exceptional assembly of industry leaders; I enjoyed every minute of it it provided a rare and outstanding opportunity to interact with, learn from, and create dialogues with world-acclaimed oil and gas leaders. Professor Sulayman Al-Qudsi, Chief Economist and Head of Economics Division, Gulf Investment Corporation I enjoyed the Assembly and Dinner and found them a unique mixing of the top level industry and finance communities. James Brady, Vice President, Technology, Schlumberger SIS The event had a very good formatThe dinner was excellently organised. Little to fault Philip Dimmock, COO, Equator Exploration The inaugural World Oilfield Services Assembly surpassed my expectations. Discussions with industry peers revealed interesting new ideas on customer service to apply in my own organisation. Daljit Gill, Vice President, Business Development, Weatherford
Palantirs economics and planning software suite includes: Practical economic modelling and reporting for multiple assets, including risking and advanced sensitivity analysis. Portfolio optimisation and management. Optimise based on factors of your choice and see instant results. IFRS financial forecasting, bringing economic data seamlessly into financial reports. Over 80 pre-built global fiscal regimes to save time and improve accuracy in modelling.
PalantirCASH
Palantir Solutions provides economic tools and planning expertise to help petroleum companies make the right decisions on business planning, portfolio strategy and capital allocation. We have provided software and services to companies of all sizes in global locations. Palantir consulting services include: Petroleum economics and modelling Expert fiscal advice Portfolio and strategic planning Bid round support Training Systems integration
PalantirPLAN
PalantirFINANCIALS
PalantirREGIMES
For more information see our website www.palantirsolutions.com or get in touch with us at info@palantirsolutions.com.
Special Article
It is not the biggest, the brightest or the best that will survive, but those who adapt the quickest. Charles Darwin In todays fast moving society, the energy industry is at the heart of change. The increased complexity and multitude of challenges in the business requires a different type of response, at a different pace. Events of the last three years have shown that the Energy industry generally remains behind the pace of change caused by the global circumstances. The industry has failed to respond effectively to environmental, social-political, demographic and economical themes which are so dramatically impacting the performance of the Energy companies and the way they are perceived by the general public. This is not just about technology; it is about adaptability and leadership. Adaptability in leadership is about changing, and stimulating change in others, to meet the demands of a rapidly transforming global environment. But how often do we as leaders hear about, witness or experience the challenge to recognise and embrace or adapt our worldviews the worldviews that drive our patterns of thinking, feeling and leadership behaviour? Do we recognise that by rising to this challenge to adapt ourselves we will affect the effectiveness of our organisations and the success of the Energy industry as a whole?
First-Degree Change
In many cases, organisational change efforts have been analogous to remedial or curative treatments for acute medical conditions. Organisations have effectively been treated as patients by expert consultants. Patients are generally given diagnoses based on presenting symptoms, and then treated with a course of medication to fix or eradicate the health problem. This is principally an expert-driven form of change. It is also known as first-degree change. In healthcare a first-degree medical intervention can, to some degree, limit the progression of lifestyle-based diseases such as diabetes or obesity. But the underlying psychological, interpersonal, and environmental factors that perpetuate the development of the disease symptoms are neglected. The patient is generally a passive recipient of treatment and therefore has limited agency in improving their health. Similarly, first-degree approaches to organisational and leadership development have focused on providing curative solutions that attempt to fix problems such as poor performance, lack of productivity, and lack of engagement from the outside in. In a typical first-degree change approach a leadership team is in a sense treated by an expert who administers leadership skills courses, team-building workshops, communication skills training, and many other well-intentioned programmes that provide a temporary fix to the identified problems. Although these first-degree change solutions can to some degree limit the deterioration of performance, leaders are not invited to recognise and address the limitations of their worldviews and personal patterns of thinking, feeling, and behaviour (i.e. changing from the inside out). Much like patients receiving treatment from experts, leaders may be left with a diminished sense of agency, responsibility and power to create the change that is required. Let us look at a case study example of this.
Special Article
Realizing that the management team also needs a change intervention, the coach arranges for her colleague to come and do a team-building day where the team learns about conflict management and better communication. Phil, who is always open to improving himself, responds well to the intervention. He works hard to perfect his feedback skills, and practices the relaxation technique three times a day in an attempt to improve his mental state. The team reports that Phil is friendlier and less critical, and for a while the morale is good. But eventually what seemed too good to be true is exposed. Phil is booked off from work for what the doctor describes as burn-out. To avoid situations where criticism of his team felt inevitable, Phil had delegated as little as possible while working himself beyond a state of fatigue. Now the team was without a leader and the huge load of Phils responsibilities was creating a great deal of conflict and confusion amongst his abandoned management team leaving them feeling incompetent and without clear direction. How and why did this happen?
Special Article
were having a significant negative impact on his leadership style and on his management teams performance. Phil could have been invited to assess how his habitual patterns were actually working against his goal of improving workplace relationships and the functioning of his organisation. The coach couldve invited Phil to acknowledge how a fear of being criticized or judged was ironically driving his criticism of himself and others. Rather than encouraging Phil to improve and correct himself, the coach might have invited Phil to become more tolerant and accepting of himself and others, while acknowledging the good and positive. After helping Phil evaluate and relax these dimensions of his team and leadership style, the coach could have moved on to helping Phil find alternatives to the one right way approach that made it difficult for him to delegate tasks. By helping Phil see that over-responsibility and micromanagement of the management team was actually creating disengagement and poor functioning, the coach could have shown Phil how risking more and allowing for so called mistakes along the road of progress would actually empower his team to take more responsibility for their tasks and performance levels. As you can imagine, this would be counter-intuitive and difficult for Phil and it would therefore require a careful balance of support and challenge from his coach. As far as Phils management team is concerned, the coach could have established what each team members worldview, beliefs and assumptions were, and how these were influencing their responses to the current problems. The coach could have used a deep leadership assessment, combined with individual or group coaching sessions, to help the team own their part in either fuelling or addressing the teams difficulties. As with Phil, each team member could have been invited to challenge the assumptions and behavioural habits that reinforced the dynamic between the team and Phil, and amongst team members. By, from the outset, locating responsibility for the needed changes and paradigm shifts at level of every individual (rather than purely on Phils or the coachs shoulders) any blaming and potential disengagement patterns could also have been addressed. As you can see, the premises, practices and outcomes of second-degree change are vastly different from teaching new skills or administering team-building exercises. A fundamental assumption of second-degree change is that individuals, teams and organisations already have the necessary resources and abilities to solve their problems, affect change and make progress. The role of the leadership coach is therefore that of facilitator who helps the individual and team remove barriers that block the development of that inherent potential.
The authors of this article are Wim Kuit (Head Of Leadership Coaching) and Damien Deighan (Managing Director) of Powerful Organisations. Powerful Organisations purpose is to guide senior leadership individuals and teams through deep change processes that will transform the performance of their organisation. Email Damien directly at: damien@powerfulorganisations.com The co-author is Ennio Senese who is the CEO of STOA International, a Strategy advisor for the Energy sector and a former Executive with Accenture and Shell, a Board panel member with the Oil Council, Fellow with the EI and with the IMC. Email Ennio directly at: ennio@omniscientbv.eu
Oil & Gas Company Executives Register Today for only $1 495! Special Industry Delegation Discounts Also Available!
Featuring some of the industrys most influential minds, including:
Frank Holmes CEO and CIO US Global Investors
Oil Council
ENERGY CAPITAL ASSEMBLY AMERICAS
Welcoming A New World Order: Defining the Roadmap for Future O&G Finance and Investment
Peter Tertzakian Chief Energy Economist, Managing Director, ARC Financial and bestselling author
Tony Weber Managing Director and Chief Investment Coordinator, Natural Gas Partners
Lead Partners:
Partners:
Toronto Stock Exchange TSX Venture Exchange
Bourse de Toronto
www.oilcouncil.com/ecaa
info@oilcouncil.com