If you have math-whiz kids, consider encouraging them to become petroleum engineers. They'll make a fortune, and probably spend time in such garden spots as Kuwait, Kazakhstan, or scenic Sakhalin Island.
As BusinessWeek recently noted, a growing shortage of technical types -- petroleum engineers, geophysicists, technicians -- is now plaguing the energy producers and their oilfield-services peers. Schlumberger (NYSE:SLB) CEO Andrew Gould talked about the shortage when his company released its latest quarterly results, as have other industry leaders such as ConocoPhillips (NYSE:COP) CEO James Mulva.
By now, you needn't be a Texas wildcatter to know that we're facing oil production declines in many areas of the world, as formerly thriving fields grow tired, lose pressure, and yield less crude. In the U.S., for instance, output has declined more than 20% in just the past decade. And that phenomenon is being repeated in other producing areas, including Mexico and the North Sea.
To compensate, producers have moved into much deeper waters and more remote locations in search of new oil discoveries. However, this trend only increases the need for sophisticated technologies and the experts who can effectively employ them. But progressively larger numbers of today's oil-patch engineers are more likely dreaming about retirement than offshore horizontal wells.
Indeed, as a University of Kansas recruiting piece for its petroleum engineering program points out, many currently practicing PEs are reaching retirement age, even as demand for the profession is skyrocketing. At the same time, a blue-ribbon task force said earlier this year that the energy talent pool has been hit by a two-thirds drop in geoscience enrollment during the 17 years ending in 2000.
Industry leader ExxonMobil (NYSE:XOM) has established programs to encourage the study of math and engineering, especially among minorities. Nevertheless, it appears likely that energy's technical talent shortfall will only increase in the years ahead, further plaguing the world's ability to keep up with its increasing demand for oil.
That's yet another reason for Fools to keep the increasingly important energy sector at the top of their investment watch lists. The next couple of decades will be full of challenges for oil-patch professionals and energy investors alike.
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