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1.5 Industry Structure

Lecture_Industry-structure

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24 views3 pages

1.5 Industry Structure

Lecture_Industry-structure

Uploaded by

David Alfonso Caraballo
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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1.

5 Industry Structure
Hello and welcome back. Today I am going to tell you about the structure of
petroleum industry.
In post-Soviet era, Russian economy undergone significant transformations.
Deep structural changes affected petroleum sector as well. Its core is composed of
vertically integrated companies that control the whole route ‘from the well to the
gas station’.
Initially, vertically oriented companies were based on state-owned
production associations that included, besides proper production divisions, almost
all satellite and auxiliary units, such as drilling contractors, maintenance, and other
organizations handling the essential operations, as well as interfiled and interfiled
pipelines, oil treatment stations, tank farms and other surface facilities. Thus, a
vertically integrated company is a self-contained system and can be considered a
local monopoly which controls the sectoral infrastructure of a certain region and
thus can keep competing producers from entering this region.
As for global practice, the most common organizational model is the
following: there is an operating company authorized to develop certain fields, and
this company involves multiple contractors such as drilling companies and service
providers that perform such operations as well logging, hydraulic fracturing, and so
on.
An operating company consists of multiple departments and offices which
deal with geology, field development, production technology, finance and
economics. By all means, the operator employs its own drilling engineers and
supervisors that are located on site. Their job is to control drilling and service
companies.
A drilling contractor owns drilling rigs and employs drilling crews; its job is
to drill wells. A service companies employs many qualified experts in various
aspects of petroleum business that can solve any issues related to well construction,
completion and stimulation.
In competitive economy, operators and service companies can find excellent
potential for mutual development and profit. An operator needs solutions that
would make production more efficient, while a service company has these
solutions and makes profit from granting the operator access to them. Together,
they can achieve more and make better use of their resources, technologies and
finance.
New and advanced models of relationships between the operator and the
contractor, such as sharing profits and risk costs, and collaborative decision
making, make partnerships stronger, as both parties become interested in
successful, cost-efficient operations.
A few words about a career in petroleum business – why it is so attractive.
Every year, our civilization needs more clean, safe and accessible energy.
This drives oil demand, and oil demand drives oil production. Petroleum industry
sets ambitious goals, and you can help it in achieving them. If you want to make
the world a better place, if you like challenge, if you want an interesting and
rewarding job, you might want to consider a career in petroleum business.
Why is this career attractive? You get good salary, share of profits,
substantial fringe benefits, but that is only part of the answer.
Petroleum industry is really multidimensional. It means that almost any
talented person can apply his or her talents there. Petroleum industry has a whole
arsenal of jobs for chemists, mathematicians, economists, accountants, technicians,
geologists, power engineers, lawyers and many others.
Petroleum engineer is one of the most challenging and promising jobs.
According to the Society of Petroleum Engineers, to satisfy world’s demand
for energy, we need 38% more petroleum engineers. It really is the dream career –
the one that can match your skills, talents and ambitions.
Petroleum engineers deal with exploration, development and operation of oil
and gas fields. They are innovators applying cutting-edge technologies to develop
new, revolutionary methods of finding and producing oil. Petroleum engineers are
experts in various fields. Drilling engineers, process engineers, reservoir engineers,
environmental engineers, consultants, teachers, government relations people,
entrepreneurs and managers; they all serve the same purpose – providing energy
for the civilization and preserving the environment for generations to come.
Petroleum engineers work both in the office and in the field. Besides, this
job often requires traveling all around the homeland and the world, going where
their talents are needed right now.
The demand for new methods, technologies and energy sources keeps on
growing, which means that the demand for petroleum engineers is growing as well.
In petroleum industry, starting salaries for university graduates are among
the highest. Even an entrant can be offered a decent position and lucrative benefits.
The world has always needed and will always need energy. Oil and gas are
the most important energy sources. The job of a petroleum engineer is to find new
ways that will help satisfy global energy needs. Petroleum engineers shape our
future and change the world. So don’t miss your chance for a unique and exciting
future.
In Russia, petroleum industry is the second in terms of salaries; right after
banking business. How much are you going to make? That really depends. Above
average – that’s for sure. This chart may give you some idea, although particular
numbers really depend on the company, region, you experience, etc.
For the rest of the world, let’s turn to the annual research conducted by the
Society of Petroleum Engineers. Thus, according to SPE, in 2014 median annual
salary in petroleum industry was 156439 US dollars, which is 13036 dollars per
month. Average annual salary, including bonuses and other benefits, was 214328
US dollars.
What are the keys to a successful career? Among the major factors, people
quote good training and hard work. If you are a devoted professional, if you love
what you’re doing, you are going to succeed in any field.
So if you set you mind on petroleum industry, don’t worry – you’ll make it!
Good luck and see you next week.

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