[Editor’s note: This interview appeared in the July 2020 edition of E&P. Subscribe to the magazine here.]  

The effects of the COVID-19 pandemic have been felt by every industry around the world, including oil and gas, which has seen its workforce shrink significantly within the past few months.

Similar to its peers in the industry, NexTier Oilfield Solutions Inc. has had to shrink its organization in response to activity declines, said Robert Drummond, the company’s president and CEO. However, Drummond is confident in the efficiency of the NexTier workforce and the company’s ability to rebuild in the future.

“As we have had to shrink our organization, we’ve been careful to protect as much of the talent as possible,” he said in an interview with Hart Energy’s Jessica Morales and Brian Walzel. “Being a very versatile workforce, for example, you have supervisors in the field that would take a temporary demotion to become an equipment operator to allow us to concentrate the skill set. Then when activity returns, you re-dilute it and you put the guys back in the jobs they had before and you are able to bring in some entry-level labor around that.”

“The playbook for doing it is very good and I would just say, from our position, enhanced a bit because we had the ability to do that with two companies at once,” he continued. “It just so happened to be related to our merger right before the virus impact.”

NexTier Oilfield Solutions was created in late 2019 following completion of the merger between C&J Energy Services and Keane Group. The oilfield equipment supplier is based in Houston and has a presence in all of the major basins across the U.S. with the largest position in the Permian Basin.

Looking ahead, oil demand is expected to return as lockdown restrictions tied to the COVID-19 pandemic continue to be lifted and companies begin to open back up.

“As you would expect, the recovery for the oilfield services [sector] is directly linked to the outlook for our customers,” Drummond said. “And for them it depends on the global supply and demand balance for oil and ultimately the price of oil.”

“We expect it to take a while though for these [global oil] inventories to work their way out despite the fact that recently we have oil prices moving in the right direction, we’re starting to see the operators who had shut in oil production in the U.S. turn some of that production back on,” he added. “We think that’s a precursor perhaps to operations beginning to increase as we move into the latter part of the summer.”

Click here for more on NexTier Oilfield Solutions’ operations.

Jump to a topic:

  • History behind NexTier (0:25) 
  • OFS sector recovery timeline  (2:13)
  • When will activity return? (4:41)
  • Precautions taken in response to COVID-19 (6:55)
  • OFS on the other side of the recovery (8:41)
  • U.S. shale’s global role (10:25)
  • Loss of workforce expertise (12:40)
  • Rebuilding the NexTier workforce (14:15)
  • Digital technology outlook (15:30)
  • Industry’s path forward (17:41)
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