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Page added on January 24, 2017
Robots Are Taking Over Oil Rigs
The robot on an oil drillship in the Gulf of Mexico made it easier for Mark Rodgers to do his job stringing together heavy, dirty pipes. It could also be a reason he’s not working there today.
The Iron Roughneck, made by National Oilwell Varco Inc., automates the repetitive and dangerous task of connecting hundreds of segments of drill pipe as they’re shoved through miles of ocean water and oil-bearing rock. The machine has also cut to two from three the need for roustabouts, estimates Rodgers, who took a job repairing appliances after being laid off from Transocean Ltd.
“I’d love to go back offshore,” he says. The odds are against him. As the global oil industry begins to climb out of a collapse that took 440,000 jobs, anywhere from a third to half may never come back. A combination of more efficient drilling rigs and increased automation is reducing the need for field hands. And therein lies a warning to U.S. President Donald Trump, who has predicted a flood of new energy-sector jobs under his watch.
Automation, of course, has revolutionized many industries, from auto manufacturing to food and clothing makers. Energy companies, which rely on large, complex equipment for drilling and maintaining oil wells, are particularly well-positioned to benefit, says Dennis Yang, chief executive officer of Udemy, a company in San Francisco that trains workers whose careers were derailed by advanced machinery.
“It used to be you had a toolbox full of wrenches and tubing benders,” says Donald McLain, chairman of the industrial-programs department at Victoria College in south Texas. “Now your main tool is a laptop.” McLain, who worked as a rig hand for 25 years, is helping to retrain laid-off oil workers for more technical jobs.
Dangerous Talk
During the boom, companies were too busy pumping oil and gas to worry about head count, says James West, an analyst at investment bank Evercore ISI: “We got fat and bloated.” He says the two-and-a-half-year downturn gave executives time to rethink the mix of human labor and automated machinery in the oil fields.
Still, in the current political climate, they’re proceeding cautiously. More robotic drilling ultimately means lower labor costs and fewer workers near some of the most dangerous tasks. But oil companies probably will frame their cost-cutting technologies simply as a way to be more competitive around the world, says West.
“They’ll more likely brag about the automation rather than these head counts,” West says. “It’s kind of dangerous to talk about jobs in the Trump administration.”
Yet Trump is seen as the great hope for more shale-job creation than ever before, says Jay Colquitt, founder of OilfieldTrash.com, an online news portal catering to oilfield workers. As more federal lands open up for drilling, the jobs will follow, he adds.
“Even though modern technology is great, you can’t eliminate the person,” says Rodgers. “To make sure it never fails, you’ve got to have somebody there watching it, to verify it.”
The industry is acutely aware of the heavy reliance on manpower, after the world’s four largest oil-service companies spent $3.12 billion in severance costs during the past two years, says Art Soucy, president of global products and technology for Baker Hughes.
Rigs have gotten so much more efficient that the shale industry can use about half as many as it did at the height of the boom in 2014 to suck the same amount of oil out of the ground, says Angie Sedita, an analyst at UBS Corp. Nabors Industries, the world’s largest onshore driller, says it expects to cut the number of workers at each well site eventually to about five from 20 by deploying more automated drilling rigs.
The impact of technology extends well beyond the wellhead. Automation-related jobs for software specialists and data technicians are in demand as the oil industry recovers, said Janette Marx, chief operating officer of Airswift, an oilfield recruiter. She sees explorers and service companies being much more methodical and selective in their hiring this time around.
“To me, it’s not just about automating the rig, it’s about automating everything upstream of the rig,” says Ahmed Hashmi, head of upstream technology for BP Plc. “The biggest thing will be the systems.”
That means an engineer can design an oil well at his desk. With the press of a button, an automated system would identify the equipment needed from a supplier, create a 3D model and send instructions for building it out into the field, Hashmi says. “That is automation.”
7 Comments on "Robots Are Taking Over Oil Rigs"
dave thompson on Tue, 24th Jan 2017 10:21 pm
Bloomberg to the rescue. Automation will make it all right.
Sissyfuss on Tue, 24th Jan 2017 10:40 pm
When will the robots start bitching about the price of gas?
rockman on Wed, 25th Jan 2017 1:10 am
More asinine hype. The Iron Roughneck is not a piece of “automative equipment” let alone a f*cking robot. Essentially it’s a big ass hydraulic wrench. And two floor hands have to push that huge chunk of steel into the drill pipe to make the connection. Certainly a lot easier/safer then “swinging a chain” like it was done decades ago. Ripped a lot fingers off back then. OTOH there have been a few hands crippled by an IR. I would like to see this asshold writer maneuver that big tool into position to make a connection every few minutes for 12 STRAIGHT HOURS in 96° temperature as I’ve seen it done a number of times.
Cloggie on Wed, 25th Jan 2017 3:14 am
The robots are taking over everything, most consequential every aspect of physical production work. Soon it won’t be no longer interesting where physical labor will be cheapest, because it will be done by robots anyway.
Here a recycling plant where every little piece of garbage is being sorted to achieve near 100% recycling:
https://www.youtube.com/watch?v=Z0vwogI1S0I
Mining will be another obsolete job in the near future because of this.
I don’t see how a base income can be avoided for the endless masses of the future unemployed.
Cloggie on Wed, 25th Jan 2017 3:21 am
Recycling robot for an iPhone:
https://www.youtube.com/watch?v=pEltZ2sJH3Y
Davy on Wed, 25th Jan 2017 6:27 am
Robots are more techno optimism fantasy. They are now a permanent force in manufacturing and mining this is true. The debate is how much labor can they replace? Techno’s see a new period of transformation with automization. This is just another example of taking the idea of efficiency further and further and in the process sustainability and resilience decays in direct relations to this process. The issue in play today is diminishing returns and limits. That constant force in civilization of an economy maintaining growing growth and producing more technology and development is not infinite. We are now in the vicinity of the end of growth. In fact positive growth may have ended in 08. Since 08 it has been malinvestment which has resulted in non-performing loans that are extended and pretended by repressed rates and liquidity easing. It takes a growing and heathy economy to replace an energy foundation with alternatives and a production foundation of working humans with robots. These techno delights will stop in their tracks once the right stuff is not present in the economy.
This end time may very well be soon with the appearance of systematic condition of demand destruction of stagflation. We are in stagflation with dangerous debt deflation and inflation pressures from per capita issues of a growing population and declining resource base. Unfunded liabilities are present everywhere from social security to insurance. Techno’s forget this inconvenient reality because technology has grown and adapted through a century of a constant average growth. Techno’s are habituated to this economic condition. The economy is now a constant in their thought. They may allow for a financial down period but only within a progressive trend of constant growth. This new growth will be a continuation and will be green, renewables and with robots.
How much longer can this century of growth continue is debatable? Clearly what has happened in the last 10 years should give us pause. We quickly forgot about 08 and discount the current macro-economic mess as manageable. We are in the last stages of a bubble that is modern civilization. When corruption and manipulation takes over this social narrative the end is near. We are now incapable of reforming modern man because of this technological blindness and economic fantasy. Techno optimist are the vanguard of this. Politicians speaking of a future of “more” enhance this delusion. Central banks believing their modeled money systems will support growth further enhance the fantasy. It is about a story and when people believe the story things happen until they don’t. Stories are part of a human denial mechanism that is a product of a human mind that can dwell in an abstract future. Eventually false stories like ours don’t work on a finite planetary system. We are inching closer to a time when modern man’s story stops working.
The budding force of nationalism is just such a time. You can’t do the things techno optimist want to do without globalism. The economic right stuff will not be there. We are going to fall down a level or two with economic activity once globalism is damaged by populistic nationalistic policies. I give it a few years because this is a process. The false narrative of nationalism and the unsustainable nature of techno development will collide in the process of the end of growth. Globalism was the pinnacle of modern man’s growth. Without growth the house of cards collapses. This coming period will be an ugly time of dashed hope and physical disenfranchisement. People will be angry and there will be no plan B’s just failure. Then the real work begins. Back to long days of human labor for little reward. Back to being human not gods with robots and fancy toys.
Midnight Oil on Wed, 25th Jan 2017 8:22 am
Good those workers are free now to fill the job openings at the factories Trump will provide….oops hope them robots don’t get those jobs too!