| Description | Gaffney Cline group interview. This involved four interviewees - Peter Gaffney, David Garford, John McGhee, and Geoff Cull, all of them colleagues who had worked together at Gaffney Cline. The interview was recorded at the Gaffney Cline & Associates UK headquarters at Bentley Hall, Hampshire, England on Tuesday 17th January, 2017. Interviewer Eric Crockart. Summary by Eric Crockart.
2 sessions were recorded during the day on a Zoom H6 digital recorder. Each participant had an individual microphone. Peter Gaffney and David Garford wore Rode Lavalier lapel microphones. John McGhee and Geoff Cull wore Audio Technica PRO 70 lapel microphones. Eric Crockart used a hand held Audio Technica AT8010 microphone. The original recording produced five mono sound files, one for each of the participants. In post-production Eric Crockart panned each of these mono sound files to create a single stereo mix sound file. The stereo placement is: Peter Gaffney - hard left; David Garford - mid left; Eric Crockart - centre; John McGhee - mid right; Geoff Cull - hard right. Indicative timings in the summary are given in (hour:minute:second) format.
SESSION 1.
(0:00:00) Introduction by Eric Crockart. PETER GAFFNEY, born in London on 21st July 1934. Primary and secondary education in Trinidad, university Royal School of Mines, Imperial College. Qualified in what was then called Oil Technology, combination of petroleum engineering and geology. Became involved with oil industry because his father was involved with it in Latin America, and he grew up in the oilfields, so almost inevitable.
(0:01:33) DAVID WILLIAM GARFORD, born in North London 17th July 1938, educated village and grammar schools, went to Birmingham University to do petroleum production engineering - that is what he considers himself to be. Became involved with oil industry because as a teenager growing up in the Midlands he saw BP, then called Anglo Iranian, pumping wells in Nottinghamshire and Leicestershire. Appealed also because his father and grandfather had travelled internationally as young men.
(0:03:09) JOHN McGHEE, born in Glasgow (does not give DoB on recording, but CV says 26th September 1936), raised in south of England, educated grammar school, then Imperial College of Science and Technology, graduated BSc in Chemical Engineering. Then spent 2 years in ordinance factory in Bishopton, Scotland, where he met his wife, and then joined Texaco Trinidad in 1960. Explains he considers his expertise to be in everything, from downstream part of industry, spent 7-8 years in Texaco, by end of that time taking interest in production side. Moved to Kuwait, spent two years in then most advanced refinery in Middle East. Via Telex invited to join GCA (Gaffney Cline & Associates), which he did in 1970. Moved into production engineering and production economics side of business. First became involved with oil industry after his graduate apprenticeship in Bishopton, had always been interested in oil industry, so applied to Texaco and was accepted.
(0:05:19) GEOFFREY WILLIAM LANE CULL, born in Croydon, south London, 17th February 1947. Went to series of schools, ending up in Latymer in Edmonton, went to Exeter University to read Engineering Science, joined Rolls Royce to do graduate apprenticeship, after about a year saw advert in The Times for young engineering graduates interested in working in international environment, no more information, found it was for a service company in oil industry. Did that for three years before going back to Imperial College for a Masters degree in Petroleum Reservoir Engineering, then joined Amoco in Great Yarmouth just as early North Sea platforms coming on stream. Dissatisfaction with prospects at Rolls Royce made him respond to Times advert, no initial impulse to join oil industry.
(0:07:43) PETER explains how Gaffney Cline came into being. After short sojourn in Iraq, his first job was really in Venezuela, initially in geology and then later seconded to joint venture with Texaco and Ultramar. Worked there for five years, met Ben Cline who became his partner. Small fields, but huge number of different opportunities, wonderful training ground. End of five years, my company wanted to send me to Canada, did not want to go, had been thinking of starting on own. With Ben Cline registered an operation in Caracas in November 1962, not allowed to operate there because too young, so went to Trinidad where he had free bedroom in parents' house and developed it from there.
(0:09:21) Explains ethos of Gaffney Cline. Started with idea we do petroleum engineering, a little bit of geology, bit of operations, try to make them all practical. Over time that multi-discipline aspect set us completely apart from other advisory firms. In the end got us into really big jobs working for national oil companies because we could talk to their company leaders while most other consultancies would have to deal with their technical departments. Providing combination of sometimes reservoir engineering, sometimes looking at their assets, sometimes their people, sometimes exploration opportunities that they had, how best they could deploy their resources. It was in the end a full service, you did not know what would come down the pipe. You got on the plane immediately. Most consultancies even today can't do that. Built the business on instant response. Others memories of those early days of Gaffney Cline?
(0:11:16) DAVID A few months after Peter and Ben arrived in Trinidad he met them when they came into the office and introduced themselves. David then working for Texaco Trinidad. Recalls that then in 1963 Texaco employed about a hundred thousand people world wide, seemed to have all the skills and technical management required to be profitable in oil business, so his initial reaction was it was a very strange way to earn a living, but then spent most of his life doing it. JOHN mentions two things. One, "deep ending" - put into situations you did not expect to be in. (Sound of tapping his fingers on top of desk for emphasis) Came in from essentially a process engineering background, spent first eighteen months running the small London office. But always with a phone and fax machine ready if needed help. Don't say you can't do it, just say I'll get back to you, we'll find somebody. Second thing - "Can Do". Never move away from something you haven't done before. You can soon learn. Those were two of the big things about joining the company, every day a different problem came through the door.
(0:13:00) Any particularly knotty problems that you remember? JOHN - recalls an air conditioning project in Paris. Mentions using FORTRAN - the popular computer language of the time. DAVID Continuous learning curve, part of the challenge but also the enjoyment. Could always get back up support. GEOFF Came along later while working for a big project for Mobil in Norway. Group of engineers, seemed to be duplication of effort. Was put in touch by colleagues with Gaffney Cline, and got completely different view of industry when he met Peter and John. Different variety of client GCA had, small as well as large. Retainer clients, some had been around ten or more years. Could see mutual benefit from all the activities. Within first month of joining Geoff was in Africa for well test project. North Sea provided lot of business till oil price crash of mid-1980s, but it was the international spread which helped company survive a severe downturn. More detail on varied capabilities and benefits.
(0:17:56) JOHN In his experience that period was first time the whole industry had gone down. Peter had always insisted on having three or four offices going, and when one part of the industry came up another one went down. That part of the 1980s was first time as we see now that things are pretty worldwide on the downside, but it will recover.
(0:18:36) PETER Explains in detail how GCA started with two people and grew from there. Mentions various names. Mentions problem of industry paying bachelors at half the rate of married men, and his resentment at being paid less than married colleagues he was in charge of. GCA had simple flat payment structure. JOHN Reveals he was the 11th to join in 1970. From then for next five years had Puseri project in Indonesia and took on a lot more people. PETER We never believed size was the ultimate, that set us apart from particularly the American consultancies, and concept you had to be bigger to be better. Highest we got to was about 155, of whom 10-15 working in little management company in United States, so pure advisory staff never much above about 125. And when things went to hell in the 1980s got back to about 85-90, but big issue was don't shut Singapore down, don't shut Dallas down, just hunker down. DAVID Thinks another forte of theirs - he was 7th to join - was had very good system of internal accounting, Peter wrote it in FORTRAN. Knew where we were and where we were going in good times and bad.
(0:21:59) Views on early days of UK Continental Shelf (UKCS)? PETER Thinks there were two aspects. One or more of the major companies had indicated they did not think there was anything commercial in the North Sea. Then when things were discovered, they were reasonably keen that riches were not thought to be too high because that would impact the taxes. From Government side it was difficult to figure out why they always toned down the estimates. Mentions separate unit at GCA led by Paul Holbrook who did continuous estimates based on public data. The industry tried to avoid making estimates, the government estimated £10 billion, and we estimated £30-40 billion. Goes into more detailed explanation and tells story involving the then chairman of the UK Offshore Operators Association, trying to take get GCA to run their estimates past UKOOA before making them public. For the government to play it down was a huge mistake, because we never then planned at the political or civil service level for what we should do, because we would have done things differently. Didn't do it as well as many third world countries. DAVID Compares it with the French attitude, they did not have a large domestic industry. They set about backing their industry in a way that Britain never did. With perhaps exception of the Wood Group, very few British service companies got official backing. Also famous BP geologist in the 1950s said if there was any oil in the North Sea he would eat his hat. Texaco drilled the very first well in the North Sea, but did not get anything from it. PETER Mentions Hamilton Brothers and the Argyll Field. JOHN Said through the 1970s the UK legislation changed so many times, no wonder the industry was a little reluctant to build up. PETER Mentions how one British Prime Minister decided to make one of these changes which stopped our exploration business in the North Sea over the next couple of weeks. However, because we were so multi-disciplined, overnight our economic business went up more than we lost and we turned a bunch of geologists into economists. JOHN Recalls Peter saying at time that it did not matter if they were up or down, people either wanted to buy or sell, this was in early 1970s.
(0:29:24) GEOFF One spin off for us in the 1970s on the gas side, industry selling to monopoly at a very low price. Other companies were exploring and discovering but had no way of developing that gas. We found we were getting response by talking about undeveloped discoveries and marginal field development. Were British Government unprepared for the oil industry? DAVID May be a particular view in Scotland that Britain squandered it compared with Norway. But Norway has four and half million people, UK had at least 50 million in those days, so thinks pressures on development - Labour Govt, British National Oil Company - it was largely left to the industry, which had mixed signals, but had ready market. Compares situation then with Norway. Gas was seen as strategic resource to be used for petrochemicals and domestic consumption, many years before released for power generation. PETER Says he lives in village two hundred metres from gas pipeline, but he can't have gas - and that's because of the way it was developed at the time. Refers to intriguing comment he heard about comparison with what had happened to Britain's aircraft industry ten or fifteen years previously. Handled them both very similarly in Britain, and lost control of both. How well did British companies and industries take up challenges of the UKCS?
(0:33:07) PETER Don't think we developed a single entrepreneur in thirty years, with exception David mentioned. Other countries had multiple entrepreneur development. Can blame it on tax structure, our history, the City of London - but it didn't happen, and that was great shame. JOHN Much participation came from already large companies who got involved in the oil industry, such as Thomson - in totally different industries and decided this was worth a punt. Recalls story about Lord Thomson, who had retainer with GCA. We told him it was high risk, had to be careful. Thomson then found Piper, two wells later found Claymore, and he came back and said "I thought you told us this was a high risk industry!" ERIC clarifies this is Lord Thomson of Fleet, who owned The Times (and other newspapers) and was at one point Eric's ultimate employer when he was a young journalist in Aberdeen. JOHN Says the guy who looked after the oil business for Thomson was Alistair Dunnet (spelling?) who was part of the Thomson publishing organisation originally. How much were the oil companies responsible for this initial caution? GEOFF The majors dominated the infrastructure. That stopped a lot of smaller opportunities developing earlier, led to increase in undeveloped discoveries. Compares with later situation where major oil companies moving out of North Sea and smaller companies coming in getting tail end of activity. But have had undeveloped discoveries out there for 30 years. PETER Thinks another aspect, failure to put in common carrier laws early on - so if building a pipeline, anyone would have access to it. That stopped smaller fields getting on quickly and inexpensively. The people who controlled the pipelines set very high tariffs. DAVID That was invidious. Explains. JOHN We did a gas gathering pipeline study in 1975 or 1976. That was one thing that came out of it, if any of this to be developed, had to be some form of taking it forward and bringing it ashore without the owner of the facility "gathering all the steam".
(0:37:05) DAVID Refers to Gas Council, arm of government, monopoly purchaser of all discoveries offshore, even little ones on shore. That slowed up a lot of development. Tells extended story to illustrate this, involving what became the Morecambe Bay field. Refers in this story to slant drilling, long before horizontal drilling became established. Why were the oil companies underestimating their forecasts?
(0:41:50) PETER Does not recall oil companies themselves being that low. Not shy of making an estimate. They were telling what they thought position was. Trouble was the government wasn't, still had the famous curve showing it going down to zero just after year 2000, if not earlier. How big a factor was the nature of the UKCS? DAVID Does not think so. Technology moves on. Forties Field good example, BP left and Apache took over about 15 years ago, they've done all sorts of clever things. Refers to Brown Book government statistics, they were civil servants, just took cautionary view of everything. JOHN Thinks caution was part of it, including by the industry, did not want to appear to be professing something too large. Risk industry. Tells story of this being explained to group of bankers. GEOFF Other control from government point of view was the licensing. Favoured major companies, particularly in early days. Led to lot of areas not being utilised, because they were focussing on their early discoveries. Explains this changed because of lobbying by the industry. Later issue of joint projects, unlike early stand alone projects. We established that for many projects, lack of unitisation was holding up the project. GCA offered themselves as the brokers - different technical evaluations of what was the same structure. GCA study got rid of the bias the companies accused each other of from different interpretations of their different sets of technical data. GCA then asked to train company people to do this sort of work, then advising on disputes in North Sea, because without resolution would not get developments moving forward. Clarifies he is talking about technical disputes. DAVID Unitisation a two-edged sword. Explains.
(0:48:26) GEOFF Tells another unitisation story, involving Amoco and Shell and the Leman Field in the North Sea. Faced shutting in one side of the field and producing more from the other side, which cut off the revenues for one of the companies. Quite an eye-opener in terms of significance of unitisation and redetermination for commercial impact. PETER Goes back to how they did things and managed things from govt point of view. Not all bad. One of most positive things, after 1984-86 downturn, industry was a disaster. We changed the PRT (Petroleum Revenue Tax) regulations in North Sea, that maintained a fleet of semi-subs (semi-submersible drilling rigs) that no one else in rest of the world had. We were the only basin that kept them running during a downturn. The results of the discoveries during that downturn were the fields that were eventually put on at the end of the 1990s, and in the last five to ten years. That was done by someone with their head screwed on. DAVID That 1986 turndown was very painful, it was a great cleansing operation. In six months we went down from about 150 people to about 50 worldwide. What came out of that as oil price plummeted, gets you thinking how can you do things better and cheaper. Some of the older platforms were getting more like refineries, rather than what you wanted to get things ashore. Decisions made to make things simpler, buy more things off the shelf. PETER Tells story of going to a meeting in Glasgow at time of initial phase of the North Sea. Had two or three vice-presidents from major oil companies who were developing. People in audience all potential suppliers. All very positive, about billions of pounds to be spent. Four seats away from Peter is a little Glaswegian guy who ran a small machine shop. He waited till fairly far on in this conference to drop his bomb. He asked the VPs to explain how he and his colleagues could do any work for them because their documents said they did not want to be given anything that had not been operational for at least five years. So how were they supposed to come up with a new idea that could solve their problem? Place collapsed, three VPs did not know which way to turn. There were a lot of things like that. One good thing was setting up the Offshore Supplies Office (OSO). While it did some things not so well, think it was very successful over time in ensuring a higher proportion of supplies and construction were done from this country. It was then copied in some of the countries we worked in. Set up in 1973, fairly early on - not well-received by the industry, because they did not want to be told who to contract with. But thinks net impact was very positive.
(SESSION 1 ends at 0:55:55)
SESSION 2.
(0:00:00) Introduction by Eric Crockart. What was it like to work in the early days of the North Sea oil industry, what was the mood? DAVID The oil price very different, in early days sometimes one or two dollars a barrel. Years later capping them at hundred dollars a barrel, now that is out of date. It was a great adventure for a young man, you were free to do your own thing. Lot of things I did in those days would be illegal now. Did not have respect for environment we now have, or local cultural sensitivities. JOHN Agrees. When they joined the industry, joined it to go overseas. From late 1970s and early 80s, people joined it because they wanted to stay at home. Totally different mindset about where you wanted to take your career.
(0:03:12) PETER Recalls a conversation he had about ten days earlier with a senior executive of one of the larger companies. Told Peter that in one particular sector of their Aberdeen office there was no one under 37 years old who has actually been on a rig. Once we got to about 20 years old in the North Sea that was one of the things that inhibited cost reductions and improvements, because a huge section of the staff had never worked abroad, where they did things differently and often a lot cheaper. That really inhibited Phase Two of the North Sea and even bits of Phase One. JOHN chips in with observation about putting refinery engineers offshore, which PETER agrees with. Clarifies what he means by Phase One and Two of the North Sea. DAVID said you used to get lots of vaccinations, but recalls trying to send someone later to somewhere abroad and found he had only had one vaccination. GEOFF Said when he got into the industry, it was dominated by the Americans. But Gaffney Cline got the benefit of both British and American cultures, because of its founders. PETER observes also to this day GCA has a huge amount of Trinidadian culture, and still having to explain terms to other colleagues who had not experienced working in Trinidad. JOHN recalls that the Dallas office of GCA took on one American who lasted a very short time, and staffed it with Brits - surprised the Texans - also three Trinidadians. GEOFF Americans were in the forefront of drilling, construction and training. When he first got into industry it was the training he found so rewarding. Explains. Experience of working all over the world, some jobs even done in languages other than English. JOHN Makes point that GCA has never had departments - everyone mixes, part of the multi-discipline, quickest way to learn. PETER We never had computer supervisors till about 20 years after, computers run by the senior or second senior secretary, never told them it was complicated. All the staff, bar about 5%, reasonably competent in FORTRAN - programming before you could buy software. That made us very different from anybody else.
(0:09:55) DAVID Until personal computer revolution came along in the early 1980s, all the software we used we wrote ourselves. PETER The 1500 wells in Trinidad for BP we monitored those for 14 years, all based on the first 1130 M-Prod (spelling?) which we wrote. JOHN (laughs) 8k on a 520k disk. PETER The last straw before we shut down Trinidad, we shut down when we were still making money, but more and more problems. Entire staff were Trinidadian. Sent an 1130 (IBM 1130 computing system) computer disk (indicates that it was about eighteen inches across), tells story of difficulty of getting it out of Customs, and how the Customs House burned down before it could be retrieved.
(0:12:05) Has the UK benefitted from a half century of oil and gas development? JOHN & GEOFF say yes. JOHN explains why he thinks there have been benefits. DAVID Quantified by taxable income from employment, more subtly led to expertise. Recalls the laissez-faire era under Prime Minister Margaret Thatcher when the industry was deregulated in many ways. Then there was the dash for gas. Thinks the North Sea contributed to some of the hubris in the Thatcher period. Accelerating the closure of the coal industry and other traditional industries, and becoming much more of a service economy, substantially banked by the oil and gas industry. PETER says he takes a more negative view. Because we developed our own industry was high cost, little serious attempt in first 25 years to market any capability overseas. Expounds upon this in detail, using example from Indonesia. Also Singapore. GCA had growing and ultimately marvellous business in Argentina, but went to see commercial secretary and got lambasting because Britain was perceived to have no expertise in land operations. Peter tried to put him right on this. JOHN points out the UK started in land drilling. GCA preferred consultant in land drilling in the early 1970s. PETER talks of drilling wells for Place, all land exploration. One of them more or less at centre of big gas reserve in Lancashire. Well almost at TD (total depth) on Christmas Day, very cold. Tells story of his colleague returning to find eight open fires on the derrick floor. Toolpusher calmed him down and told him that they had been drilling for ten or fifteen years and not to worry because they had never found anything yet! DAVID recalls another incident from early days of North Sea, experience of the weather and the waves. Remembers getting a call from offshore saying they were getting the hundred-year wave every week. Previous weather data from North Sea had been floating, this was first time getting data from fixed structures, learning curve there. PETER said biggest and most significant improvement in drilling performance was in North Sea, north of 62 degrees. Explains this was when they started putting motion compensators on the rigs to help unload casing and cement. Improved drilling performance by getting an extra one or two months a year. Stands out to this day as one of the significant improvements. Some time in the 1970s on the semi-submersibles. Explains how the compensators worked. DAVID analogous to huge springs, very sophisticated suspension system. (0:20:31) GEOFF Well tests for companies a good business for us till mid-1980s. First time he went out there, a lot of contractors, collecting specific pieces of data. Problem industry had at that time is they guarded their data, they did not share it. So one of the jobs we got was we got the data and combined it and prepared report for the oil company. Gives more detail. Sadly we are down to two or three companies now, but in the 1980s lots of small companies trying to come up with the tools for this data collection. Geophysicists had a lot of data. That was where GCA made their mark because of multi-discipline nature of way they worked. Also successful with market studies, both here and overseas - drilling rig utilisation, crane barge utilisation, likelihood of new pipeline. We were clearly seen as source of an independent forecast that had some value. JOHN points out they did not do it by asking people what they thought, but by doing it from first principles.
(0:24:38) PETER says obvious there has been economic benefit to UK from the oil industry. Explains. Just disappointed we didn't open the doors wider. Could have done better. DAVID on hubris and dash for gas, compares with Holland and Venezuela. PETER Talks of the concept of "the curse of petroleum". Gives examples from Trinidad. Asks ERIC as an aside about what is happening with the ring road round Aberdeen. Then goes on to give example of the curse of petroleum round Calgary. The oil price crash of the 1980s, what was that like, what lessons were learned? GEOFF We had to cut back at that time. Things shut down fairly quickly in terms of new business. Had some retainer clients that lasted. It was work from overseas that helped at that time. Gives detail of what happened. Talks of then UK energy minister Alick Buchanan Smith. JOHN Everyone got a little bit smarter over how they did business. DAVID For me it was philosophical, nothing lasts for ever. All of us much more cautious after that. It was a cleansing. Peter went to Australia and gave presentation they were still talking about years later. JOHN Got them up singing. PETER price was $8.50 that morning. We've come through a 2008 one, there was one in late 1990s. Not to do with the North Sea, to do with our industry. Each time we let the wrong people go. Management rarely culls themselves. Gives more detail. Drillers have the shortest memories in the world, will go from charging their rigs at 15% to 150% overnight. DAVID points out oil price crashes had happened before this, like in the 1920s. PETER Talks of his father's experience when oil price varied from five bucks to fifty cents, he said it was still a good industry. What helped us was by focussing on throughput, did much better when the price went down than when it went up.
(0:36:11) ERIC recalls an earlier Capturing the Energy interview with John Milne, who worked in Aberdeen on procurement side of the industry, saying he knew several millionaires from Aberdeen area but no billionaires. PETER We haven't developed a really significant entrepreneur. Closest is Sir Ian Wood of the Wood Group. Mentions some other names elsewhere. Difficult to tell if it was the London market, or taxation. Phenomenal when you look at a ten year period in Australian history where we had something like 12 people on the international stage, half of them in the oil and gas industry. Mentions names. These were tigers, we didn't have anybody, very strange. Development of Canadian Basin, they developed a lot of very rich people, some of them helped start the North Sea. JOHN And they all worked together to help each other, it was a sort of club of Canadians. PETER Some of my friends said London was so far from the North Sea and some of the analysts had never bothered to understand the North Sea. When things were going up, one of the famous investment banks said they wanted GCA to do a little investment for them in the United States. Explains what happened, illustrating lack of understanding of the industry.
(0:41:34) How do you regard your involvement with the oil industry? JOHN Would do it again, no doubt about it. Fascinating industry. Expounds on this, reason why he switched from downstream side to upstream side. DAVID In his case it was timing, the year he was born. Fortunate, remembers being in the Trinidad office when he heard John F. Kennedy had been assassinated. Testing very large gas well in North Sumatra when he heard Yom Kippur War had taken place between Israel and Egypt, main factor in the oil price climb. Was in BP office in Eakring in Nottinghamshire when he heard about Piper Alpha disaster. Was in the Bentley office building when he heard about much more recent Macondo blowout (in Gulf of Mexico), and his BP shares plummeted. Also recalls the Sea Gem disaster, think it was 1966, which was one of the first that drew public attention to the high risk of this business. PETER The fascination never departs. Explains this, including his difficulty in getting up ladders and going on helicopters. But when steps on rig floor he does not feel anything till he gets off. You see things, you don't know how you are going to fix them - that's the challenge. Technical aspects, you hear of high-tech, but where the problems are, it is in stuff that is pretty low-tech. Problems are the same my dad used to tell me about. The equipment has not changed that much. Huge drilling problems all come down to people and simple things. Half the high-tech does not work anyway.
(0:46:33) GEOFF Thoughts from listening to what others saying. Next significant event after oil price crash of 1980s was collapse of Soviet Union. We found ourselves able to work in projects in Russia, but area where we did most work was Caspian Sea, had not done work there at all prior to collapse of Soviet Union. Found out some of the Russian technology was fit for purpose, just way it was managed was terrible. Gives example of project he was involved in in Siberia. DAVID Gives examples of his experiences in Russia. Estimates were very low, for good reason, because if you failed to meet a target you ended up in Siberia. Talks of huge platform in Caspian Sea with six wells on it, in North Sea we would have had 80. Blowout preventer equipment very primitive, very poorly managed. Talks of the evidence he saw of blowouts. Asked how many people had died as result of fires. Was told 7. When he expressed skepticism, he was told they were Party members. JOHN They were the only ones who counted?! PETER Asks Geoff about Siberian field he took him to one time. Deviated drilling. The Sputnik ESP (electrical submersible pump). GEOFF says first time he came across deviated drilling was in Texas. Explains he was told the technology had come from Russia. When he got there he found they had got the tools but they had not developed them. Tells in detail of a conference in Russia, and attitude of the Russians to Western technological developments. Recalls Peter doing presentation in mid-1990s at Moscow University - they had started Society of Petroleum Engineers chapter there. Both UK and US had been through the downturn in the 1980s, that affected university numbers, but beginning to recover. But learned there were more English-speaking petroleum engineers graduated in Moscow than the whole of the UK and US together. Over the years have seen more people with a Russian background in the industry and internationally. Imperial College course struggled to get UK students, but kept going by overseas students, and that is still the case - more overseas students for petroleum engineering than UK ones.
(0:56:25) ERIC Between you have about 200 years experience of oil industry - how has the industry changed from when you were starting out, particularly the people involved? PETER When I started the big companies run by technical people who had moved into management. Now great majority of them run by accountants or lawyers - bean counters. That has had huge impact, very negatively (interruption at this point from Gaffney Cline employee who puts her head round conference room door - subject of anecdote later in interview) There are some exceptions. Exxon has continued to appoint some engineers. Industry has gone through phases when run by drillers. Explains why. When we joined industry we all thought we would have one job for life. Now tell kids, count on six to ten. The companies trained you. Very few companies now train anyone, whatever they say. JOHN Specialisation has become over-riding now. But also need people who can see from A to Z. DAVID Talks about liking the concept of generalisation rather than specialisation. His own profession has now been subdivided at least ten different ways. PETER Goes back to the aircraft analogy. Talks of a close friend who had been designer through many years. When started had weekly meetings of all the people involved in working on different parts of the aircraft, if one had a problem everyone made suggestions. Now not like that - two reasons. Explains they no longer can, and management system does not allow them to. Aircraft now take four times longer to develop. JOHN So do North Sea fields.
(1:02:07) Did your careers develop the way you had hoped? PETER By time I got to work, because it was a small multiple operation, knew it was going to be necessary to change jobs. What I did not realise for first three or four years was maybe simpler to build a job yourself. DAVID Always liked travel, adventure, working with different cultures. GEOFF Echoed that. Mentions project they were all involved in for ten years, from about end of the 1990s, in India. They had project which challenged all our capabilities. Reason it lasted so long, because we delivered for them when they knew they could not deliver themselves. Largest offshore operation anywhere in the world. DAVID and JOHN comment on this. Following discussion reveals that GCA had received a letter that week asking if they would come back on to this project. Reveals the problems and how GCA solved them. GEOFF tells story of how a helicopter flight from one of the offshore Indian platforms was delayed because of technical problem, they were then told to get aboard, circled platform and landed again - then told that was the test flight, with everyone aboard! PETER Thinks even though there is more environmental legislation, some things now done worse than they did them previously. As a young engineer if he had spent 2% of is time on HSE (Health and Safety) that would have been a lot. Now probably close to 25%. But lot of my time now on 40-year old assets, with ten thousand items we monitor. If any one of them lets go, we have an oil spill or a safety issue. At same time drilling high pressure, high temperature wells that cost multi-million dollars now more concerned about their safety aspects than would have been drilling six thousand foot well 30 years ago. JOHN tells amusing story about Alistair Dunnet and project at Ardersier, in early days of North Sea oil industry construction, shedding light on attitude to safety then. DAVID talks of flipping over platforms to install them, a very tricky business. Very early days of simulation. Tells story of this. PETER Nothing has changed. Tells story of recent drilling operation, with reference to simulations.
(1:12:09) Summing up, any aspects of your careers you want to draw attention to? DAVID For many years the six hundred foot water depth was seen as a limit in the North Sea, thinks it was the limit for saturation divers. Grew up in a world where you never deviated a well more than 60 degrees. Explains why. Then the depth barrier went, and this barrier with the drilling. French input in developing horizontal drilling. GEOFF With North Sea, there is infrastructure there. Always intrigued me what else could be done? Don't know what scale of undeveloped discoveries are, also not all the Continental Shelf has been explored, but how are you going to get more exploration? Is the UKCS a backwater now, because you can get supplies from other parts of the world now? Think there are challenges for the people out in the industry now. Mentions mentoring graduates.
(1:18:13) ERIC Is the North Sea industry something that you would encourage them to join, is there a perception problem about the North Sea being in decline? GEOFF Tells story of the colleague who had popped her head round the conference room door a few minutes before. Joined GCA as a receptionist, but studying to become a petroleum engineer, now a petroleum engineer with Gaffney Cline. So there are examples of young people with enthusiasm to get involved. DAVID Technical observation, when he went into the industry in the early 1960s, the trend was to make the wells technically very complicated. Then into 1970s North Sea established, wells more expensive, one or two major reservoirs, everything then went to simplicity and minimising failure points. Now in world of drilling multiple horizontal wells, a plan looks like railway sidings, so gone back to complexity. ERIC Asks them what they are each most proud of having achieved? GEOFF In early 1980s worked in GCA Singapore office. Had client in Perth, Australia, a non-operator. Drilling exploration well offshore. Operator decided it should be plugged. GCA asked to look at this by non-operator client. Geoff said indications of hydrocarbons. Result was agreement to test the well, operator not too happy about Gaffney Cline getting involved. Non-operator client asked Geoff to supervise operation. Watched pressure gauge going down. Operator view - this proved nothing there. But Geoff had authority to tell them what to do, waited for 45 minutes and the oil and gas came. Overnight the project became a series of fields developed by GCA's client, because the oil company got out of it. JOHN Things he feels proudest of are number of companies GCA has dealt with, starting from nothing, making them into reasonable oil companies. Counts Thomson, MRAG (the Greenland Authority), Gold, Lamag (spelling?) in Russia, these are companies that came in with no background in the oil industry. Lamag in the Caspian we actually ran the field for the first year, they were traders and they got this concession. That side is the most satisfying for me.
(1:25:41) DAVID Recalls the maxim of the late TV and Radio presenter Terry Wogan, they either like you or they don't. The client really has to like you. I think I contributed by liking them and getting them to like me, to deliver technically and commercially. PETER The multi-discipline approach. We were lucky that's what we focussed on, it worked like a dream, still thinks so. It's not the same as what the oil majors call multi-discipline, they just put teams of people in the same room and say they are all working together. None of them have guts to do what we did - put engineer in charge of a geological project, or geo-physicist in charge of an engineering one. And be prepared to take the risk. Preaching that still today. The wider your eyes are, the more you are likely to stop the person above you doing something stupid. Gives more detail. Professional societies don't like it at all, have their own territories. Have to be prepared to tackle that as well. JOHN Remembers Peter telling him very early on that when you go out for a sales chat, don't worry about talking - just listen. Then you find out what the guy's problem is - despite him thinking he knows it. Pays tribute to Peter's ability to find out what really needs to be solved.
(ENDS 1:30:10) |