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Thousands of jobs for UK oil and gas sector

Oilfield Technology,

The oil and gas sector could create up to 39 000 new jobs in the UK over the next two years, according to new research from Bank of Scotland.

Job creation
A survey of a broad cross section of 100 UK oil and gas companies, suggests expectations of job creation have increased by 5000 since last year, when it was expected the sector would deliver 34 000 new jobs.

Growth prospects
The majority (69%) of oil and gas executives remain confident about their growth prospects in 2014/2015, however this is slightly down on the 77% who predicted growth last year.

Talent concerns
Concerns around talent in the sector have also grown, with 38% naming a shortage of skills as the greatest challenge, up from 33% last year. The availability of skilled workers was the most challenging for engineering companies (87%) while just 20% in exploration and production felt it was an issue.

International expansion
International expansion was a priority for 64% of those asked, an increase of 5% compared to last year. Africa is the priority market for future investment, with 21% targeting growth the continent, while North America (17%) and the Middle East (18%) also remained key areas for investment.

Foreign markets
With international income accounting for 44% of turnover, almost half (46%) of exploration and production companies said they were already planning further growth in foreign markets over the next two years.

When asked about diversification, 48% of companies were moderately to intensely interested in onshore shale gas, while 38% had the same degree of interest in funding solutions for decommissioning activities. More than a third (36%) also said they were interested in diversifying into renewables.

Research findings
Other findings from the research included:

  • 42% stated new international growth markets provide the biggest opportunity for the industry
  • 10% cited access to projects in new growth markets remained challenging

Stuart White, Bank of Scotland Commercial area director, commented: “The findings of this report are excellent news for the economy demonstrating the employment generating nature of the oil and gas industry now and in the future. With most of the UK’s oil and gas firms clustered in Aberdeen and the Northeast, Scotland should reap the largest share of these new jobs, however other parts of the UK will benefit from expansion plans.

Workforce challenges
“The report also highlights the growing challenges posed by the lack of a skilled workforce. Positive action is underway to address this shortfall, with new partnerships between higher education institutions and industry as well as the creation of new specialist apprenticeship schemes.

North Sea environment
“The results also demonstrate the global nature of the industry as more firms look to expand internationally and tap into the markets with the largest levels of recoverable reserves. With 44% of income already generated internationally, this is not a new trend, and reflects the reach UK firms have as the industry benefits from the expertise gained in the challenging North Sea environment.

“Our client base mirrors this trend. We have seen a significant increase in our support to the industry in recent years to facilitate international expansion and we expect this trend to continue."

Adapted from press release by Katie Woodward

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