In the oilfield, it's out with the old and in with the new, and that's a big problem for the industry.

When an experienced righand retires, he takes more than his coveralls and hardhat when he finishes his last day on the job. His decades of experience and know-how leave the job site with him. That's hard to replace and is a major challenge for the oil and gas companies.

It's been almost two and a half years since the Deepwater Horizon disaster, and our industry is still feeling the impact in unexpected ways. In the aftermath of that tragic event, investigators looked at the causes and most attention focused on the well integrity failure, the loss of hydrostatic control of the well and the failure of the blowout preventer (BOP) equipment. ""When the Deepwater Horizon exploded, no one in the BP engineering team had been on the job for more than six months," says John Konrad, a former drill ship captain and co-author of Fire on the Horizon: The Untold Story of the Gulf Oil Disaster".

A deepwater rig can be built in a couple of years, but it takes much longer than that to grow the skills needed to run it safely. There is a dire shortage of skilled, experienced workers to work on those platforms and it's one of those challenges that money alone won't solve.

The situation isn't much better for land rigs either. Older, more experienced workers are retiring every day and replacements with 20 or 30 years of experience are hard to come by. After the oil bust of the late 1980's, lots of guys left the industry. Unless you were doing P&A (Plug and Abandon) jobs, there just wasn't much work.

According to the Energy Information Administration, U.S. oil field production peaked at 3,517,450,000 barrels in 1970. By 2008, it had fallen to 1,830,136,000 barrels, barely half what it had been almost 40 years earlier. If a worker started out as an 18 year old roughneck in 1970, he would most likely have been retired or nearing retirement, by 2010. From 1985 to 2007, the production graph looks like a ski-slope, downhill all the way. That's not the description of an industry that's going to draw a lot of applicants.

The current boom has the industry, both in the U.S. and Canada, scrambling to find new workers. The hours are long, the work is hard, but the outstanding pay is bringing in legions of new workers. When drilling commences near some small towns, the local workforce can be quickly drained of energetic young men and women drawn away by big paychecks and bonuses. A good example of this process is the town of Woodward, Oklahoma. The local minimum-security prison, just 15 miles away in Fort Supply, is so understaffed that inmates are sometimes literally able to just walk away. The prison’s deputy warden, William Monday, was quoted in the media as saying “I could hire 17 correctional officers today if I could get them to walk through the door.”

The owner of the local Dairy Queen franchise is considering cutting back on the hours they're open because he can't find enough workers to cover the shifts. It's a common story all across the area and it's repeated in hundreds of towns across North America.

In Canada, the shortage of skilled and experienced workers is becoming a real problem. As early as November of 2011, the Canadian Association of Oilwell Drilling Contractors (CAODC) issued a statement saying "The greatest limiting factor when examining overall utilization rates will be the shortage of skilled rig workers," and that it expects only a 1 percent increase in drilling in 2012, due largely to the worker shortage.

The Canadians may be short on rig hands but they certainly aren't short on training. They have become the world's first government to offer a formal program, Enform, to provide courses and hands on training for would-be rig workers. The courses cover required basic drilling skills and a vast array of safety practices and policies. Nearly everyone who graduates will have a job waiting for them. For years, they even had a full-scale, operating drilling rig at their training facility in Alberta. The CAODC also sponsors the Rig Technician training program that targets drillers, motorhands and derrickhands, the three most senior crew positions on a rig. It's a mix of on-the-job training and classroom education. The problem is that although completing the course qualifies the worker for all three positions, the process takes three years.

The righand shortage in the U.S. is also severe, and there are a number of private companies offering training courses, but so far the Federal government hasn't made any moves to directly address the problem. A couple of years of on-the-job training is fine, but there's no substitute for two or three decades of experience and the guys who have that are heading out the door, or will be soon.

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