Drilling deeper: Petroleum engineers still a necessity for oil industry, despite fluctuations in industry

GRAND FORKS, N.D. -- Alexy Kovalev knows his job doesn't sound that exciting to the average person, but it's obvious he loves it as he talks about how what he's doing will have a real impact on the oil industry.

GRAND FORKS, N.D. -- Alexy Kovalev knows his job doesn't sound that exciting to the average person, but it's obvious he loves it as he talks about how what he's doing will have a real impact on the oil industry.

"The outcome of this project will be to collect data from a number of wells in a certain area and be able to plot them and correlate them with other logged data and be able to know what's going on at different depths," he said. "That's what geologists and petroleum engineers want to know because that determines the way they deal with that rock. It determines, actually, a lot of things, which ends up down the road allowing them to spend their money properly and make more money."

The 32-year-old petroleum engineering major is working on a privately funded five-year research project at the University of North Dakota examining the content earth samples taken at the sites of oil wells.

"I'm really excited to be a part of this," Kovalev said as he analyzed samples with a handheld X-ray machine of sorts.

Kovalev said when he started looking into petroleum engineering programs back at home in Russia, he saw UND as the only viable option. His instructor and project manager Scott Johnson said he's confident his student will find employment when he graduates in about two years.


But with declining oil prices, some schools are reporting issues with job placement. A Wyoming Public Media and Inside Energy article published last month said universities in Colorado and Wyoming couldn't find jobs for their graduates.

In California this January it was reported oilfield service providers Baker Hughes Inc. and Halliburton Co. planned to cut thousands of jobs as drilling activity slows further due to a decrease in crude oil prices.

Forbes Magazine also reported there were some 50,000 oil patch layoffs after Saudi Arabia decided to keep its oil taps open last November. The number of drilling rigs in North Dakota alone dipped by 40 from December to January of this year affecting 4,800 to 7,200 jobs, according to Forum archives.

But local officials say fluctuation is normal and UND's young program appears to be finding its footing because regardless of the price per barrel, petroleum engineers are needed to invent new drilling techniques, improve existing ones and find newer and better sources of oil.

"I know this might be challenging during the downturn in oil price, but in the long term I think it's still going to be very promising for people who might decide to become petroleum engineers," Engineering Dean Hesham El-Rewini said.


A promising program

According to a presentation Interim Chair William Gosnold made to the department's advisory committee, the program had an enrollment of four students in fall 2010 when the program first got off the ground. Numbers stayed low until 2012 when the program became an official department, and enrollment went from 39 students that spring to 115 in the subsequent fall.


There are currently 300 students enrolled in the department, which is the second highest group under mechanical engineering.

Since the first graduating class in the spring of 2013, 12 students have graduated from the program and 11 are slated to graduate in May.

El-Rewini said the numbers are still small, but it's his understanding that many of those graduates have gotten jobs.

That's because there's more to the oil industry than just drilling. Instructors and administrators at UND say they are preparing petroleum engineering students to go into a variety of areas within the field.
"Although you're not producing, you're still exploring and an engineer can help you find where to explore," El-Rewini said. "Engineers are not only working in the field, they're also in the lab and in the office trying to come up with new equipment, new methods, new techniques to be able to produce oil more economically and more environmentally safe. These are things you still need to do whether the price is high or low."


Close-to-home advantage

Half of the students enrolled in petroleum engineering have home addresses in North Dakota or Minnesota, which both El-Rewini and Gosnold said gives their graduates a leg up in the Bakken oil fields.

"They're not scared of the weather," El-Rewini said.


UND alumnus and successful international oil tycoon Bob Solberg also said local applicants have an advantage, but North Dakota graduates have a good reputation on a national scale. While working for Texaco, he unwittingly discovered 11 of the 55 people he was working with were from North Dakota.

"They have common sense, they're industrious, ethical, and willing to work," he said. "They're willing to take on challenges."

Solberg has also donated millions to the start of the petroleum engineering program as well as it's new energy complex.

But the nature of petroleum engineering can call for a lot of moving around. Solberg and his wife moved 17 times in 33 years and he said UND graduates need to be prepared to work in a global market.

El-Rewini said he is doing what he can to answer that demand by including business knowledge in their class offerings along with the technical college petroleum engineers need to know.

"We just do our best to produce the best graduates, and I think that goes across the board in everything we do," he said.

The job market

According to the Bureau of Labor Statistics, petroleum engineering jobs are projected to increase 26 percent from 2012 to 2022, but oil prices are a "major determinant of employment growth."


The BLS also said the median salary for petroleum engineers was  $130,280 annually in 2012, which comes out to $62.64 per hour. El-Rewini said even if a decline in oil prices affects the salaries of petroleum engineering graduates right out of college, they're still making more than the average 20-something.

More recently, the website Payscale's 2014-2015 College Salary Report, which analyzes national salary and employment trends, released data showing petroleum engineering graduates make the most money of all degree-holders.

The BLS also states job prospects are "highly favorable" because many engineers are expected to retire.

"All these are signs that it's not going to be that bad," El-Rewini said.

There are also jobs available like the one Kovalev, a UND student, is doing and other research projects to make oil extraction more efficient. This can involve working hand in hand with other types of engineers.

Along with being team players, Solberg said students should focus on the big picture of the oil industry, not just on gas prices, as not all oil taken from the ground ends up going into vehicles.

"What we need to teach the engineering student is it's a bigger world you're trying to come into," he said. "It's not about getting a job in an oil field in Williston, (N.D.)"



What's next

El-Rewini said he plans to continue to move his young program forward with the addition of masters and PHD programs.

He also just hired two new faculty from Australia, one of whom will permanently chair the department. They should begin working at UND within the next couple months.

But perhaps the biggest upcoming milestone for petroleum engineers at UND is the $15.5 million Collaborative Energy Complex, which is slated to house all of the engineering programs in one building.

El-Rewini told the Herald in February they had raised about $14 million in funds for the building and that they would hopefully be able to break ground this summer.

While the school already has some hands-on labs, El-Rewini wants to push for more field trips and include collaborative learning space in the new CEC, which he calls the "new front door for engineering."

"We're building labs with experiments so kids can get a feel for what it's really going to be like," he said.

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