Shortage on the east coast

In his address at the 2011 APIA Convention, Federal Minister for Resources and Energy Martin Ferguson said that on the east coast of Australia, Queensland’s CSG industry may generate as many as 18,000 jobs.

“While job creation is good for the nation, it is also creating sectoral pressures in terms of wages and labour given our very low level of unemployment,” said Mr Ferguson.

QGC is currently constructing the Queensland Curtis LNG (QCLNG) project, a two-train 7.4 MMt/a CSG-to-LNG production and export facility on the Queensland coast, including a 380 km pipeline from the company’s Surat Basin tenements to a port site.

QGC has said that by late 2013, the company will have about 1,000 operations employees in Gladstone, Brisbane and the gas fields. The company’s major contractors will employ on average approximately 5,000 people over the construction period to 2014 on the LNG plant in Gladstone, the export pipeline network, and the gas fields infrastructure. Construction skills required will include pipe fitters, steel fixers, machine operators, welders, riggers and scaffolders, metalworkers, electricians, instrument fitters, carpenters, concrete finishers, and labourers.

To assist with the skills shortage, QGC is working closely with TAFE colleges in Toowoomba and Gladstone, with a staff member from the company also on the Energy Skills Queensland CSG/LNG Skills Steering Committee.

QGC currently employs more than 50 university graduates, and will take on 20 university vacation students in the next few months.

“Our major contractors employ more than 90 apprentices, and about 2,000 people have done short-course training across 20 skill areas,” said a QGC spokesperson.

“We also require professionals in geology, engineering, finance, planning, human resources, production operations, supervision, operations maintainers, maintenance, safety, environment, warehouse and stores and administration.”

The company has recently launched a $1.2 million rental assistance scheme for trainees and apprentices in Gladstone as part of its support for targeted jobs growth.

“QGC’s staffing requirements are being met mostly from within Australia with the exception of a small percentage of highly skilled professions such as geology, petrophysics and engineering,” said the QGC spokesperson.

“The QCLNG project provides a wonderful opportunity for Queenslanders who have left the state to work in oil and gas all over the world to return home. This is a multi-decade industry where young people entering the profession can look forward to a long-term future.”

In December 2011, Santos also launched an initiative to address the skills shortage, by entering into a partnership with Skills Tech Australia to establish a specialised CSG and Gas Transmission Pipeline Operations Training Centre in Acacia Ridge, Brisbane, that will train operators for its GLNG Project.

The project is a joint venture between Santos, Petronas, Total and KOGAS that will feature a two-train 7.8 MMt/a LNG facility at Curtis Island, Gladstone, Queensland.

The agreement with Skills Tech Australia entails training 70 employees; 60 training positions for its gas field operation and a further ten training positions for operating the proposed 435 km, 910 mm diameter GLNG pipeline.

“These positions will be quite specialised and integral to managing the flow of gas through Santos’ GLNG pipeline from Roma to Gladstone once construction is completed in order to feed the LNG plant on Curtis Island,” said Santos GLNG President Mark Macfarlane.

Shortage on the west coast

Mr Ferguson also said that on the west coast of Australia, the Chevron-operated Wheatstone LNG Development project alone is calling for 3,000 construction jobs, on top of the many indirect jobs that will flow from the project.

The initial phase of the Wheatstone LNG Development will involve a 250 MMcf/d domestic gas plant at Ashburton North, and two processing trains with a total capacity of 8.6 MMt/a of LNG. A 220 km, 860 mm export pipeline will transport the gas from the Wheatstone and Iago gas fields to the onshore gas plant, while a second pipeline will be laid to allow future tie-ins from other gas fields.

The Wheatstone project is a joint venture between the Australian subsidiaries of Chevron, Apache Corporation, Kuwait Foreign Petroleum Exploration Company and Shell. First LNG shipments are planned for 2016.

Chevron is simultaneously constructing the Gorgon LNG Development, a joint venture with ExxonMobil, Shell, Osaka Gas, Tokyo Gas and Chubu Electric. The project involves a 15 MMt/a LNG plant and a 300 TJ/d domestic gas plant on Barrow Island, off the northwest coast of Western Australia. An underground pipeline will transport the gas to the island’s central-east coast for processing, and 90 km subsea pipeline will deliver compressed domestic gas from Barrow Island to the Western Australian mainland, which would interconnect with the Dampier to Bunbury Natural Gas Pipeline.

During peak construction, the Gorgon and Wheatstone projects together will create an estimated 16,500 direct and indirect jobs in Australia, according to Chevron.

Chevron said it is committed to investing in the long term future of Australian jobs and skills.

“We have so far invested $12 million on recruiting and training 40 apprentices and trainees in preparation for when the Gorgon LNG and domestic gas plant becomes operational. More recruiting campaigns are planned,” Chevron said.

Chevron now also employs 120 university graduates across a range of oil and gas related fields through its Horizons graduate development program.

“These are young people who are getting valuable experience on the front-line and being given significant responsibility as they grow into their full potential. These young people are the leaders and experts of tomorrow – who we are investing in today,” said Chevron.

“Our priority is to employ Australians,” said Chevron. “Having a ready-made local workforce can be good for the economy and helps businesses like us plan efficiently. However we continue to monitor labour availability and market trends and there will be challenges ahead. We will need the best and right people to do this work and will continue to work closely with governments, industry groups and contractors to help address the employment challenges.

“If there is a skills shortage, we would want the Government to have in place a flexible and efficient process that will allow companies like us to engage a sufficient number of skilled workers from overseas.”

Government initiatives

In his 2011 APIA Convention address, Mr Ferguson acknowledged the challenges the pipeline sector was facing with regards to skilled workers.

“While these major projects create opportunities and demand for pipeline infrastructure, I also recognise that these major projects can compete with the pipeline sector for employees, making your life harder. The Australian Government understands the need to invest in training and skills,” he said.

The Federal Government has allocated $3 billion in the 2011 budget for new apprenticeships and other training measures, which aim to help industry make the most of growth opportunities.

In September 2011, the Government opened the Banana Engineering Skills Training Centre in Biloela in September 2011, which Mr Ferguson said “will enable young people to train locally and support the growing resources and energy sectors in Queensland”.

In December 2011, Federal Minister for Tertiary Education and Skills Senator Chris Evans announced that in partnership with industry, more than $87 million will be provided to help skill and up-skill 23,777 workers through more than 250 industry-driven projects through the National Workforce Development Fund.

“These are critical industries for our economy,” said Mr Evans. “They are industries facing ongoing skills shortages which require employees with high levels of specialised training. The funding will mean employers can recruit and train new employees for available positions, and existing workers will also be given the opportunity to upskill.”

The Government has also made changes to migration arrangements, including the introduction of Enterprise Migration Agreements (EMAs), a new temporary migration initiative to help address the skill needs of the resources sector.

EMAs are a custom-designed, project-wide migration arrangement for large-scale resource projects such as Gorgon and Wheatstone, which aim to help ensure peak workforce needs are met, easing capacity constraints and ensuring economic and employment benefits are realised.

“[These changes] are designed to ease pressures in the short term. Businesses should take advantage of these measures,” said Mr Ferguson.

APIA’s world-first plan to address the skills shortage

APIA’s response to the skills shortage has been to implement the Pipeline Engineering Training Project.

Stage 1 of the project commenced in 2009, and comprised developing the basis for competency-based training of pipeline engineers, and developing a key resource document that would capture the breadth and depth of industry knowledge that is held by the baby boomer generation about pipeline engineering and, in particular, AS2885.

The results from Stage 1 were the APIA Guide to AS2885 and the APIA Competency Standards.

The Guide to AS2885 is relatively straight forward to apply, acting as training material for new pipeline engineers and as a reference for experienced engineers.

The Pipeline Engineer Competency Standards comprise a list of approximately 230 competencies that will be required across the community of pipeline engineers.

With the first stage complete, APIA is now moving into the second stage. Focuses will include:

• Assisting the industry in using the Guide and the Competency Standards
• Developing new courses that respond to the industry’s needs and competencies gaps
• Working with Engineers Australia to have pipeline engineering recognised
• Developing a governance framework for the continuing development of the project
• Collaborating with the Energy Pipelines Co-operative Research Centre to continue to train engineers in existing knowledge.

At the end of 2011, APIA conducted a survey of the training needs of the pipeline industry as part of Stage 2, in a step towards developing targeted courses.

Project Manager Chris Harvey says “The APIA Pipeline Engineer Training Program should be seen as just beginning. While we have what we consider a good start, there is still a lot to be done to reach the level of maturity we ultimately hope for.

“To date, we have not been able to find any other examples of what APIA has achieved so far in its pipeline engineer program – identifying a detailed list of competencies and a standardised format for documenting them with a clear but flexible structure, and a well-supported guide to the prevailing engineering standard. We are so bold as to suggest that it is a world-first program that is fit for purpose for the Australian pipeline industry.”

Preparing for what’s ahead

As Australia’s pipeline industry continues to boom, it will undoubtedly face challenges in securing the required number of workers with the appropriate skills for the exciting projects that will develop. However, with the development of initiatives from the government, key pipeline proponents, and industry associations such as APIA, the pipeline industry is well-prepared for the challenges to come.