Permian Pipes Are Coming, But The Workers Aren't

[thackney]

Permian Pipes Are Coming, But The Workers Aren't
https://www.rigzone.com/news/wire/permian_pipes_are_coming_but_the_workers_arent-13-nov-2018-157466-article/#hasComments

...Welcome to the next big Permian Basin bottleneck. A pipeline shortage slowed output this year, leading to a record 3,722 drilled-but-never-opened wells. But three major conduits set to open in 2019 are expected to solve that. The newest snag: Finding hundreds of workers over the next 18 months to open those wells, at a time when the firing of 440,000 workers between 2014 and 2016 remains a fresh and painful memory.

“It’s a huge concern for 2019," said James Wicklund, a Credit Suisse Group AG analyst in Dallas. "It’s frankly today a bigger concern than oil prices, because oil prices are fine where they are. The availability of labor is not."

By the time the new pipelines are fully in service, potentially adding more than 2 million barrels a day of capacity, the number of unfracked wells could reach 7,000, according to the Tulsa, Oklahoma-based consultant Spears & Associates.

Now, there’s 174 fracking crews in the Permian, according to Primary Vision Inc., with roughly 20 to 30 workers each. Colin Davies, an analyst at Sanford C. Bernstein, expects that count to fall even lower. But once the pipes open, Davies believes as many as 100 more crews may quickly be needed.

Schlumberger Ltd., the world’s biggest oilfield services company, said on a conference call last month that it was trying to hold tightly to some of its experienced oilfield workers by looking at shifting them to other jobs until they’re needed back in the Permian field. And the industry is starting to recruit broadly, focusing on areas well outside the Permian so as not to cannibalize companies and communities close to the oilfields.

But it’s not an easy proposition. After being fired in the oil rout, many former oilfield workers, like Byrd, have settled into other jobs with much less volatility. Meanwhile, the U.S. jobless rate is at its lowest level in years....

[dfwgator]

Gee, if only we could find a bunch of workers from Central America.  /s

[thackney]

Gee, if only we could find a bunch of workers from Central America.  /s

...Rather than simply finding warm bodies to do the work, Dale said companies are pressing for experienced or qualified people. But she’s having a hard time filling those requests...

[Elderberry]

My son has just gone thru two layoff cycles. He is a MWD Field Engineer. After the first layoff cycle he was picked up as a recruiter. Now after the last layoff cycle he he going back to the field. He was just recently picked up and hasn't yet received his first assignment. He's hoping its not Permian though. He had spent most of his time at Eagle Ford, with some time in North Dakota, Oklahoma, and Ohio.

[IsailedawayfromFR]

My son has just gone thru two layoff cycles. He is a MWD Field Engineer. After the first layoff cycle he was picked up as a recruiter. Now after the last layoff cycle he he going back to the field. He was just recently picked up and hasn't yet received his first assignment. He's hoping its not Permian though. He had spent most of his time at Eagle Ford, with some time in North Dakota, Oklahoma, and Ohio.

He is likely the kind of hand the industry is looking for.  Been there, done that.

My +40 years in the oil patch taught me that it swung wildly from feast to famine, from domestic to international, to making lots of money to laid off.

It is not for those who wish an 8 to 5 steady job.   If one accepts that, there is opportunity to prosper.

But it is fascinating, and I would not have traded it for any other industry.

[Smokin Joe]

He is likely the kind of hand the industry is looking for.  Been there, done that.

My +40 years in the oil patch taught me that it swung wildly from feast to famine, from domestic to international, to making lots of money to laid off.

It is not for those who wish an 8 to 5 steady job.   If one accepts that, there is opportunity to prosper.

But it is fascinating, and I would not have traded it for any other industry.

Yep. I'm still somewhat active, but riding the slow chug up the next hill of the roller coaster... Been at it since '79.

[Elderberry]

Well my son just headed out. He's going into NM just north of Pecos.

[IsailedawayfromFR]

Well my son just headed out. He's going into NM just north of Pecos.

Good for him.  Hope he can find some reasonable accommodations and does not have to rely upon the back seat of his truck

[Smokin Joe]

Good for him.  Hope he can find some reasonable accommodations and does not have to rely upon the back seat of his truck

Better buy a cheap winnebago up north, get his own generator, too.

[Elderberry]

He had told me that in the past there would be 4 MWD Engineers sharing a trailer onsite. It sucked to be a #5 new guy, cause you were on your own for sleeping arrangements. When they picked him up they said they couldn't start him out as a lead, as they'd been burnt before. But said possibly when he had his 60-90 day review.

[Smokin Joe]

He had told me that in the past there would be 4 MWD Engineers sharing a trailer onsite. It sucked to be a #5 new guy, cause you were on your own for sleeping arrangements. When they picked him up they said they couldn't start him out as a lead, as they'd been burnt before. But said possibly when he had his 60-90 day review.

Great way to get experienced hands cheap. Then all too often the promised raises don't materialize. Tell him to keep his options open and a finger in the wind.

[IsailedawayfromFR]

Great way to get experienced hands cheap. Then all too often the promised raises don't materialize. Tell him to keep his options open and a finger in the wind.

The entire episode will likely ensure some money in his pocket and some street-wise character building like both of us experienced during those early oilfield days.

Nothing like them to gain the experience one can use later in life.

[thackney]

The entire episode will likely ensure some money in his pocket and some street-wise character building like both of us experienced during those early oilfield days.

Nothing like them to gain the experience one can use later in life.

Good judgement comes from experience.

Experience tends to come from bad judgement.  If you are wise, you can use the bad judgement of others.

[Elderberry]

The entire episode will likely ensure some money in his pocket and some street-wise character building like both of us experienced during those early oilfield days.

Nothing like them to gain the experience one can use later in life.

Money in his pocket is his goal. When he was discharged after 6yrs as a Nuke Machinist Mate, he went to work at Weatherford as a tech tearing down oil tools. There he competed against degreed engineers to become an MWD Engineer. He worked in the field for abt 2 yrs, mostly Eagle Ford. Laid off. Picked up as a recruiter for an outfit that provided crews to Schlumberger mostly. Then in Schlumberger's infinite wisdom, they decided to combine the roles of DD and MWD. So the outfit he was recruiting for had too many workers. No need for recruiting. Laid off agin. Well, back to the field again. He plans to Try to stay in the field for no more than 4 yrs. Then go to school,  get his sheepskin, and attempt getting into mgmt.

[Elderberry]

My son is back home. He's now on a 20/10 schedule and traded with a worker that wanted Christmas off. He says he's in a good crew that he hopes that he stays with for a long time. He said everyone recognizes that he is much more knowledgeable than his lead that has only been a lead for six months. Workers were pushing him to ask to be lead, but he said "That's not my place. I can't say anything". He said, who knows, he may be a lead when he gets back. But he knows its their decision to make. He's hoping he gets a good bump when his eval comes up. I had noticed when he first left, he didn't take his heaviest foul weather coveralls. He said he's definitely taking them when he goes back.

[IsailedawayfromFR]

My son is back home. He's now on a 20/10 schedule and traded with a worker that wanted Christmas off. He says he's in a good crew that he hopes that he stays with for a long time. He said everyone recognizes that he is much more knowledgeable than his lead that has only been a lead for six months. Workers were pushing him to ask to be lead, but he said "That's not my place. I can't say anything". He said, who knows, he may be a lead when he gets back. But he knows its their decision to make. He's hoping he gets a good bump when his eval comes up. I had noticed when he first left, he didn't take his heaviest foul weather coveralls. He said he's definitely taking them when he goes back.

He also needs good rubber boots as it tends to get wet during wintertime and the trucks churn up the mud around those locations.

While I know it saddens you a bit that he will not be there at Christmastime, I bet you are proud of him sticking with it through thick and thin.

If he stays with it, am sure he will advance.

[Smokin Joe]

My son is back home. He's now on a 20/10 schedule and traded with a worker that wanted Christmas off. He says he's in a good crew that he hopes that he stays with for a long time. He said everyone recognizes that he is much more knowledgeable than his lead that has only been a lead for six months. Workers were pushing him to ask to be lead, but he said "That's not my place. I can't say anything". He said, who knows, he may be a lead when he gets back. But he knows its their decision to make. He's hoping he gets a good bump when his eval comes up. I had noticed when he first left, he didn't take his heaviest foul weather coveralls. He said he's definitely taking them when he goes back.

I, for one, wish him all the best. I'm glad he is doing well.

[Weird Tolkienish Figure]

What companies need to offer is supplemental private unemployment insurance.

[Smokin Joe]

What companies need to offer is supplemental private unemployment insurance.

In the oil patch? Who would underwrite it? It is not a question of "if" it is a question of "when" you will be looking for work. I have been slapped with layoffs from the top of the pay scale, the middle, and the bottom.
Some companies think the best and senior hands are too expensive to keep--they can fill more slots with new guys, even though they don't have anywhere near the experience. Others will keep the core guys who can train the next crop of new folks. Still others will lay off whoever finishes up next...

[thackney]

What companies need to offer is supplemental private unemployment insurance.

What the companies do is pay higher wages than competing industries.  Workers eventually learn that is their personal unemployment insurance, or they end up working somewhere else.

[Elderberry]

What the companies do is pay higher wages than competing industries.  Workers eventually learn that is their personal unemployment insurance, or they end up working somewhere else.

My son actually received severance pay on his last layoff. IIRC it was around 15K.

[Smokin Joe]

What the companies do is pay higher wages than competing industries.  Workers eventually learn that is their personal unemployment insurance, or they end up working somewhere else.

Yep. When times are good, salt away as much as you can. Make sure you have a couple of reliable vehicles (paid for) and don't get into any long term payments you can't manage for a year or more out of your savings.

I have seen too many youngsters run out and buy expensive toys and later not be able to make the payments.
I tell them drive the least vehicle which will get the job done until you can afford to pay cash for what you want. If you are using it for work, the repairs and maintenance are a write off. Live lean until the boom dies, there will be a lot of bargains around afterwards. Shop for the big stuff out of the area, because 500 miles away, the price is significantly lower.

[Elderberry]

Talked to my son. They messed with his 20/10 schedule cause they made him a lead on another rig. And he's on days now. I know he like nights, but he says it doesn't matter cause nothing's close by. He got a raise and said he's coming home in a few weeks.

[Smokin Joe]

Talked to my son. They messed with his 20/10 schedule cause they made him a lead on another rig. And he's on days now. I know he like nights, but he says it doesn't matter cause nothing's close by. He got a raise and said he's coming home in a few weeks.

Make hay while the sun shines...

[IsailedawayfromFR]

Talked to my son. They messed with his 20/10 schedule cause they made him a lead on another rig. And he's on days now. I know he like nights, but he says it doesn't matter cause nothing's close by. He got a raise and said he's coming home in a few weeks.

Two prognostications:

1.  He will have a beard

2.  He will seem to have grown a couple of years of maturity. Especially as he is a lead man out there.