Energy Voice | ‘It’s time to see bigger picture’, BP boss says

Creativity and innovation don’t come as easily to North Sea oil as they do with other industries, but BP’s regional president wants to change that.

But with a “legacy” of doing things the same way for years, the basin needs a mindset change to bring that about, Ariel Flores said. As the UK continental shelf has historically been the birthplace of many new technologies, he wants to return to that period of innovation.

He said: “I think the companies can do it, they just need a very distinct, clear vision around why it’s important to do it, and for everyone to be supportive in making it happen.

“I think there is this legacy of doing it a certain way for 15 years, but embracing something that actually has been done by the same companies in other basins and trying to make it happen here sometimes becomes a challenge.

“That’s just because it’s different, and it’s hard if they haven’t done it themselves. How can they understand how it can be successful?”

Mr Flores wants to make it easier for new technologies to penetrate the industry. BP is helping facilitate that through its support of the Oil and Gas Technology Centre (OGTC).

The firm has pledged to fund the top two firms arising from the OGTC’s TechX accelerator programme, which is aimed at helping start-ups transform operations in the North Sea.

Mr Flores believes major companies need to lead from the front. He said Total was also setting a good example, announcing earlier this year that it would trial the world’s first autonomous robot at the Shetland gas plant through its work with the OGTC.

Mr Flores said the industry needs to start looking at the “bigger picture” to meet the challenges of the basin.

He said: “There is a lot of innovation and the ability for this innovation and creativity to penetrate the oil and gas industry is not the same as in other sectors.

“We have traditionally wanted things proved and tested and double-tested before we have the confidence in spending a day rate of hundreds of thousands of dollars to actually make it happen. I think we have to look at the bigger picture and embrace these ideas, and make it easier for this innovation to penetrate into our operations.”

These sorts of advancements are expected to play a big role in BP’s future plans for the North Sea.

Mr Flores has had conversations around the central North Sea becoming a testing ground for alternative power solutions such as wind, which could then be deployed at scale if they are successful.

But what will the relentless march of technology mean for jobs?

In May, BP announced plans to cut around 540 upstream jobs globally. The firm said many of the redundancies will be through natural attrition and not backfilling vacancies, and demobilisation from projects that are coming to an end. The need for new skill sets to meet the demands of the new digital age will form part of BP’s thinking when it looks at workforce requirements in future.

Mr Flores said: “What I used to do in two weeks we can now do in 20 seconds so understanding that skill set going forward will create jobs and opportunities but ultimately those skills have to exist.

“We’re doing a lot to up-skill and invest but sometimes we can’t quite get there and hence these roles have different requirements.

“We’ll try to match the capability organically, but then, indeed, it is a different solution that we’ll embrace.”

Mr Flores became BP’s North Sea president in March, having also worked in the US, Russia, Azerbaijan and Angola. As with each other region, the UK is not without its own complexities. Commercial challenges in the North Sea have convinced a number of majors to sell off assets in recent weeks.

Media reports claimed Total is looking to sell off more than £1 billion worth of assets, and in May it was reported that ConocoPhillips was considering an exit from the North Sea.

Meanwhile Chevron has revealed it plans to sell off all of its central North Sea interests.

BP is no stranger to making sales in order to keep the business fit, having last year announced a deal to sell stakes in the Bruce, Keith and Rhum fields to Serica.

Mr Flores believes such deals are good for the North Sea.

He said: “Getting assets in the right hands is important and something we believe in given our history with our assets and how they have gone to the Sericas, the EnQuests, the Apaches in the past.

“I continue to see examples where they have been able to take a different approach where it was just a function of priorities relative to our portfolio which would have made that a challenge.

“They have been able to progress resources and create strong revenue.

“We believe putting them in the right hands is an enabler for the basin. We are quite pleased with our current portfolio but I believe other companies are taking that same approach.

“The oil price being what it is, I would encourage and I would expect oil companies to look at this and it’s great that we’re able to do that. It will continue to prolong the life of many of the fields.”

Mr Flores wouldn’t speculate on who might buy the assets, but believes that the changing of hands is another tool for unlocking that
all-important innovation in the sector.

He added: “I do believe it helps the basin think differently. They help bring an approach that is innovative and creative, whether it’s deals or the way that they have been able to make things successful.

“We’re all learning from some of these success stories and the Oil and Gas Authority is working quite hard to share some of these vignettes with the different operators so that we learn from each other to try some of these things.

“Once someone tries it and is successful it becomes very empowering to help the organisation take some of these ideas on board. It’s hard at times for large organisations that have been here for a very long time to embed and embrace these, but with examples of these being delivered, it helps.”

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