“Oil and gas engineer” sounds like the career with the most secure future in Israel today. In three years, we have become a regional oil and gas power, and demand for engineers in the field is meant to skyrocket: according to Ministry of Economy and Natural Gas Authority estimates, 3,000 employees will be needed in the gas sector in the coming five years. But estimates are one thing, and reality is another. Two years ago. the Technion Israel Institute of Technology in Haifa opened a prestigious M. Sc. Engineering program , with a focus on oil and gas, together with the University of Haifa. Only four of the program’s twenty graduates have found work with the oil and gas exploration companies in the local market. Not one of the graduates has found work in government services, such as the Oil and Gas Division of the Ministry of National Infrastructures, Energy and Water Resources, which does not have an excess of experts in the field, to put it mildly. “We don’t have much hope of finding work in the local market,” a student in the program told “Globes,” “Anyone looking for work in the field needs to relocate abroad, or to go for a Ph.D. in Norway or Texas.
About half of the program’s lecturers are from abroad, because it is difficult to find suitable lecturers in Israel. One of them is Prof. Ove Gudmestad, an expert in developing offshore gas fields from Norway's University of Stavanger, which offers doctoral scholarships for the program’s graduates. “It is important that your government have people who can understand what the foreign companies that are drilling in your country are proposing,” said Prof. Gudmestad
The government can hire a foreign consultancy company to oversee the developers.
“True, but would it put Israel’s national interests first, or its own business interests?”
Norway's first oil and gas fields were discovered in the 1960s by a US company, but the Norwegians insisted on developing an independent oil and gas industry, and established a government company called Statoil, which did the drilling. Former Statoil employees then established dozens of companies specializing in technical services for the oil and gas industry. The sector today employs a quarter of a million people, according to the Norwegian Oil and Gas Association.
Israel’s gas fields are operated by US based Noble Energy Inc. (NYSE: NBL). Its Israeli partners, Delek Group Ltd. (TASE: DLEKG), Ratio Oil Exploration (1992) LP (TASE:RATI.L), and others, are essentially financial investors. An Israeli drilling company would provide jobs for hundreds of workers in various areas of oil and gas production. An initiative to create such a company came about a year ago, from businessman Shlomi Fogel, who acquired GeoGlobal Resources Inc. (AMEX: GGR) Israel’s operations, which was involved in the failed drillings at the Myra and Sarah wells. The deal was contingent upon the Ministry of National Infrastructures Petroleum Commissioner giving the company an operating license for drilling. The company’s staff was based on former Nobel Energy employees, who had drilled in more than 30 locations in Israel’s waters and discovered, among other things, the Tamar, Leviathan, Dalit, and Karish fields. Fogel and his partners proposed insuring the company against risks and accidents, and brought examples of young US companies that started from scratch and relied on venture capital and skilled workers. But the commissioner, Alexander Varshavsky, said he did not have the professional capacity to check the experience of the company’s workers, and rejected the request on grounds of insufficient drilling experience.
“With the Ministry of Infrastructure's methods, there will never be an Israeli company,” say industry sources in Israel. “It is no problem to buy an experienced company - it only costs a few hundreds of millions of dollars, and even then there is no guarantee there won’t be disasters. It is cheaper to buy good regulators abroad who know how to perform proper risk analyses. At the end of the day, the question is simple: what is the government’s plan for building an industry in Israel?”
Ministry of National Infrastructures: “We support professional training”
The Ministry of National Infrastructures said: “The ministry has been giving stipends over the past two years to undergraduate, graduate, and doctoral students, and supports training programs for engineers in the field of natural gas at Tel-Hai Academic College and at the Technological College of Beer Sheva.” Regarding the rejection of Shlomi Fogel’s request, the ministry said: “The ministry requirements for a licensed operator, with extensive experience as a field operator and the required operations for production, are essential in order to preserve a stable, high level of professionalism, which allows for the long-term development of the oil and natural gas fields.”
Published by Globes [online], Israel business news - www.globes-online.com - on February 26, 2014
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