Will Drilling Activity Pick Up in 2016?
If you read the headlines, you might be unsure about what to expect in terms of offshore drilling activity in 2016. If you feel this way, you are not alone. While one company is making acquisitions in order to ramp up production, another is laying off employees as it shuts down its offshore rigs. As an offshore worker, both slowdowns and increased activity can present additional risks on the job. So, what do you need to watch out for in 2016?
Survey Says: Expect a “Surge” of Investment Activity
According to a survey published in January, 86 percent of oilfield services companies expect the industry to see a “surge” in investment activity over the next twelve months. These companies are seeking to consolidate and roll out new technologies that will cut costs when it comes to drilling offshore. However, whether (and to what extent) this will impact offshore activity in 2016 remains unclear.
For example, Houston-based Kinetica Partners announced in January that it had agreed to purchase TransCanada’s offshore assets in the Gulf of Mexico. This includes seven offshore platforms and more than 500 miles of natural gas pipeline. While the deal is expected to close by the end of March, Kinetica Partners has not yet revealed its plans for drilling and production in the Gulf later in the year.
Schlumberger Already Looking Ahead to 2017; Noble Shutting Down Rig in the Gulf of Mexico
On the other hand, Schlumberger, the world’s largest oilfield services company, recently announced that it does not anticipate a significant recovery in oilfield activity until 2017. Citing the drop in oil prices that began in 2014, a company representative said that maintaining profits will be a challenge in 2016, and as a result the company expects to spend less on exploration and production investments for the second straight year.
In line with Schlumberger’s outlook, Noble Drilling’s Texas arm expects to lay off 100 to 120 employees in 2016 as it closes one of its offshore rigs. While the company expects the layoffs to be permanent, it noted that it would once again be looking to hire if it is able to secure a new contract for the closing rig.
Risks for Offshore Workers
As we wrote last year, when oil companies struggle, it is often their employees who pay the price. When offshore workers are asked to do more with less, long hours and other safety risks can lead to serious, and often fatal accidents.
However, when production ramps up, workers need to remain vigilant about protecting their health and safety as well. New employees, rushed production schedules and lack of safety precautions can put even the most experienced offshore workers at grave risk in the Gulf of Mexico. Offshore workers need to do their best to protect themselves, and when they get injured, they need to exercise their right to just compensation.
Contact Morrow & Sheppard LLP | Houston Offshore Injury Lawyers
Attorneys Nick Morrow and John D. Sheppard provide experienced legal representation for injured offshore workers and their families. If you have suffered an injury or a loved one has been killed while working offshore in the Gulf of Mexico, we urge you to contact us to discuss your claim for compensation.