Denmark should stake on technological quantum jumps
There is a need for private/public initiatives providing Danish oil and gas industry with a new kick regarding research and training. A significant effort to ensure the future of this industry could not be initiated soon enough, declares chairman of Danish Offshore Industry, Marketing and Development Director of Ramboll Oil & Gas, Kai B. Olsen.
In his consulting engineering company in Esbjerg he is experiencing how hard it is to get hold of qualified staff for many of the functions required by the oil indu-stry, and the same problem is acute for other companies in the offshore industry – consultants as well as contractors.
A need for Danish know-how
“Generally, we meet a strong demand for the know-how developed from the Danish oil and gas production in the North Sea. The increasing demand for oil as well as the high price level have increased the interest of the oil companies in reconsidering marginal fields requiring an extraordinary effort to achieve profitability. And it is exactly in areas like this, Danish companies have proved their expertise.
We expect that even if oil prices will show ups and downs in a nervous market the present global demand will last due to the increasing consumption in countries like China, India and Brazil. So for many years to come there will be a global need for Danish know-how.”
More attractive training opportunities
He urges the politicians to give priority to research and training in the scientific disciplines needed by the oil industry as a part of a long-term energy policy and a global strategy. This would benefit the potential for increased production and provide future specialists for the industry.
“We consider the distribution of ages among our highly educated specialists in the oil industry as being critical. The influx of new personnel is not compensating for the void created when old specialists retire, and the number of contracts to be carried out is increasing. If the relevant training is to be more attractive for young talents there is a need for increased public financing for research.
Danish Offshore Industry,
Marketing and Development
Director of Ramboll Oil & Gas,
Kai B. Olsen.
It is a general impression that when oil prices are high and the oil companies earn significant profits the government can reduce its funding, as the industry now can afford to finance research and development by themselves. But private research offers little opportunity for training, so society as such should stake on creating the best possible conditions for a technological quantum jump in order to increase production from the Danish oil and gas fields,” states Kai B. Olsen.
Technological innovation
He points out the fact that increased production will result in more profit – not only for the oil industry, but for the Danish society, too.
“Depending on the price level an increase of, say, one percent will result in an increase of some 7-8 billion US$ to be shared between the oil companies and the taxman. A focused staking on research leading to such an increased production must be decided well in time before the operators stop producing from major fields because they cease being profitable. Otherwise it is too late.”
Based on experience from the latest five years Kai Olsen finds it most unfortunate that the government gave up public funding of the strategic research in hydro-carbons by reducing its contribution to the energy research programme, EFP 2002.
“We hope soon to see a renewed public stake on relevant research, possible in new set-ups making the strategic research in hydrocarbons attractive to other industries and specialists. They may be able to look at the technological challenges with fresh eyes and thereby pave the road for new technological quantum jumps creating innovative high-tech companies.”
He calls attention to the company Welltech having developed a totally new technology increasing production from horizontal wells by using a Welltractor and similar equipment. In a dozen years Welltec has grown to a company of more than 400 employees operating in all parts of the world.
Large profits
Kai B. Olsen points at the High Technology Fund as a source of funding, but in addition to that there is a need for a clear signal by the politicians stating that the oil industry is an area worth while focusing on. An area of great opportunities for creating economical growth via knowledge-heavy jobs with a large potential for export.
“There seems to be much political prestige in increased research in su-stainable energy and more efficient use of energy. That is useful, too. But I am convinced that if our society wants to cash a large profit we shall be better off concentration on increased public research in hydro-carbons.”
The present price level, taxation and production make the oil industry one of the most important sources for financing of our future welfare. Kai Olsen feels that even if staking on strategic research always calls for a certain uncertainty, the prospects for profits for companies and society are attractive when looking at the oil industry. That is why it would be unwise to miss this opportunity – not least because the Danish society at present can easily afford it.
