1. Copyright ©2001-2012 NExT. All rights reserved Accelerating Petro-Technical Learning in the E&P Industry David R. Humphrey P.E. Director of Curriculum – Well Construction NExT Henry Edmundson Director Petro-Technical Expertise, Schlumberger Chairman, NExT Client Advisory Board

2. Copyright ©2001-2012 NExT. All rights reserved Do You Recognize the Symptoms? – Geoscientists and engineers retiring in next 5 years – Attrition of your high tech and most capable staff – Slow adoption of latest technology and software despite frequent training – Engineers who know how to push buttons but do not understand the concepts – Gap between skill needs and workforce capabilities is growing – Employees were not trained during hard times and are struggling to catch up

3. Copyright ©2001-2012 NExT. All rights reserved Exciting and Challenging Times!  Exciting! – High oil prices – New technologies – New frontiers  Challenges & Opportunities! – Unconventional reservoirs – Enhanced Oil Recovery – Deep water – Post-Macondo regulations – “Big Crew Change” “… “big crew change” is taking place now…” “… 25% of PTP… will retire in the next 5 years…” “…autonomous PTPs will decrease by 6% or 5,000…” (by 2014) “…technical talent has become a true strategic enabler for delivering production and future growth.” Source: 2011 SBC O&G HR Benchmark, and SBC, Technical Talent Shortage Could Begin to Limit Growth. JPT, June 2011. Petro-Technical Professionals (PTPs) per Age Bracket for a Typical Western Independent (%)

4. Copyright ©2001-2012 NExT. All rights reserved Percentage of SPE Members by Age ( not incl. Student Membership)

5. Copyright ©2001-2012 NExT. All rights reserved Percentage of SPE Members by Age – The Gap ( not incl. Student Membership)

6. Copyright ©2001-2012 NExT. All rights reserved The Demographic Crisis in a Nutshell  Lack of experienced petro-technical professionals (PTP) in mid-career age range  Need to accelerate development of early-career PTP’s to fill this gap  Need to develop all PTP’s in new technology used to find and produce the “tough” oil and gas  Need to recruit, develop, motivate and retain PTP’s in the context of a frenzied market

7. Copyright ©2001-2012 NExT. All rights reserved Golden Rules for Accelerated Development

8. Copyright ©2001-2012 NExT. All rights reserved Golden Rules for Accelerated Development ■ Blended learning combines many types of learning activities, especially on-the-job  Instructor-led Classroom Learning  Social networking: in the class-room  Self-Study  Learning by Doing (On the Job)

9. Copyright ©2001-2012 NExT. All rights reserved Golden Rules for Accelerated Development ■ Blended learning combines many types of learning activities, especially on-the-job ■ No compromise on quality : there is no substitute for top instruction and materials  Editorial and graphical quality of training material  Quality of instruction, generally the instructor  Need for technical content and instructor to be up-to-date on current technology and practice

10. Copyright ©2001-2012 NExT. All rights reserved Golden Rules for Accelerated Development ■ Blended learning combines many types of learning activities, especially on-the-job ■ No compromise on quality : there is no substitute for top instruction and materials ■ Mentoring / Coaching relationships are key for providing context and support during learning  Finding senior professionals to mentor  Managing the mentor-mentee relationship  Defining the mentoring role and objectives

11. Copyright ©2001-2012 NExT. All rights reserved Golden Rules for Accelerated Development ■ Blended learning combines many types of learning activities, especially on-the-job ■ No compromise on quality : there is no substitute for top instruction and materials ■ Mentoring / Coaching relationships are key for providing context and support during learning ■ Competency management is indispensible for measuring individual development and identifying competency gaps

12. Copyright ©2001-2012 NExT. All rights reserved Golden Rules for Accelerated Development ■ Blended learning combines many types of learning activities, especially on-the-job ■ No compromise on quality : there is no substitute for top instruction and materials ■ Mentoring / Coaching relationships are key for providing context and support during learning ■ Competency management is indispensible for measuring individual development and identifying competency gaps ■ Customized learning programs are essential to fit each company’s culture, strategy and E&P objectives

13. Copyright ©2001-2012 NExT. All rights reserved Drilling Engineering: Competence 1 Competence 2 Competence 3 etc. 1234 Employee Competency Assessment Proficiency Competency Model Job Description Required Competencies Competency Management Drilling Engineering: Competence 1 Competence 2 Competence 3 etc. 1234 Gaps Competency Gaps: Individual  Individual training plan Team  Staffing aid Proficiency

14. Copyright ©2001-2012 NExT. All rights reserved NExT Framework Oil and Gas Courses Technical Software Competency Management & Technology Mastery Competency Assessment Development Planning and Implementation Competency Verification Training Programs Blended Training Programs Software Certification Masters Degree Programs

15. Copyright ©2001-2012 NExT. All rights reserved  Challenge  Exploration activity expansion  Shortage of trained PTP’s  Accelerate development of – New Hires (20 GG&E) – Mid-Career (20 GG&E)  NExT Solution  Framework for accelerated blended training  Functional competency assessment and skill gap analysis  Two (2) Training Programs:  Program 1: Fresh Graduates (Under Development-UD) (3 Yrs) Sub-Surface (5 G&G, 7 PE) Surface Facilities (3 ME, 2 EE, 1 Process, 2 Instr.) Aim : Semi Autonomous Professionals Status : Year 1 & 2 Completed, third year about to start 2 nd group proposed for 2012 Case Study: Joint NOC Training Programs

16. Copyright ©2001-2012 NExT. All rights reserved  Program 2: Mid Career (1 Yr) Geology and Res. Engineering (5 G&G, 7 PE) Aim: Full Field Development Plan Status: Started April 2011  Training Model – Competency gap analysis and identification of individual development needs – Blended : theoretical, software, and practical courses On-The-Job training, workshops, field trips, projects, mentoring sessions, project management training, evaluations, and certifications Results Program 1 Proficiency level of core competencies: – Subsurface: at 90% proficiency level (from initial 55%) – Surface: at 120% proficiency level (from initial 50%) Year 1A Preliminary courses; Integrated - project based program; Additional Individual Courses Year 1B Assigned to projects in consultation with the mentors and management Case Study: Joint NOC Training Programs (2)

17. Copyright ©2001-2012 NExT. All rights reserved Learning Elements Classes Workshops On-The-Job Training/Projects Mentoring Incremental Evaluation Presentation and Certification Learning Elements Classes Workshops On-The-Job Training/Projects Mentoring Incremental Evaluation Presentation and Certification Organization Needs Determination Determine Scope of Program Organization Needs Determination Determine Scope of Program Phase I Start-up Identify Technical Competencies Develop Matrices (Roles, Skills, etc.) Develop individual learning roadmaps Finalize criteria for success Start-up Identify Technical Competencies Develop Matrices (Roles, Skills, etc.) Develop individual learning roadmaps Finalize criteria for success Phase II Phase III Foundation Working Mastery Phase IV Refine program and expand Learning Sequence Technology Mastery Program Technology Mastery Process Overview

18. Copyright ©2001-2012 NExT. All rights reserved Thank you