2007 SPE President Abdul-Jaleel Al-Khalifa

John Donnelly, JPT Editor

What will be your main goals as SPE President?

I am climbing the trail up Everest, the highest mountain. I am following many shining stars who served as SPE Presidents, all of whom have left SPE a lasting message and contribution. My role will be to help the oil and gas industry move forward and to bolster SPE’s position as a leader and major contributor to the industry.

My lifelong goal has always been to help people make a positive impact on our industry so that they feel extremely satisfied and fully engaged. As SPE President, I plan to work very closely with industry leaders to articulate a year-2020 vision for our industry, with emphasis on people and technology, and I want to seek ways to eliminate impediments to people’s progress and aspirations. I will strive to publicize this vision and promote these values in various industry forums and meetings. This will give me a unique opportunity to serve all SPE members.

What individual views or perspective do you bring to the office?

I have worked many years in upstream exploration as well as in reservoir characterization, modeling, and field development. I have learned that people are the most important asset in our industry. Pioneers such as George Reynolds, who discovered the Masjid Suleiman field in Persia in 1908, and Max Steineke, who discovered the Dammam field in Saudi Arabia, opened up the vast resources of the Middle East for the whole industry. Professionals have an equally important role in strategic field development, where they can significantly improve the ultimate recovery of existing fields.

Being a manager for 11 years has been a very rich experience. I have realized the importance that charismatic leaders can have in unleashing the limitless potential of people. On the contrary, I have seen how workers become disengaged when managers and executives don’t inspire them. This is a critical issue facing our industry. As much as we need to recruit, develop, and retain a competent workforce, it is very important to promote charismatic leaders who can tap into the hearts and minds of the workforce.

How has SPE affected your career?

I started reading SPE papers as a young student, and at that time, there was no SPE.org, there was only microfiche. I was impressed with this resource that was so rich in technology and available for my research. After authoring my first SPE paper, I began to participate more—first as an officer in the local section, then at the regional level, and then at the international level. I found that SPE is not only a technical treasure but an outstanding team of people who excel in working together toward noble objectives. Belonging to this team instilled pride and self-satisfaction. Volunteering with SPE is at times demanding, but always satisfying. I discovered that whatever I gave to SPE, I got back at least 10 times worth.

This is the message I want to emphasize to our members. Involvement in SPE is a unique opportunity to polish technical, leadership, and social skills. SPE offers global networking, technology, awareness, and the satisfaction of knowing that you are a key player in sustaining the growth and prosperity of mankind.

What is the state of the oil and gas industry?

Let’s have a critical and candid analysis of the petroleum industry, reviewing the past and forecasting the future. On the bright side, our industry has fueled industrial revolutions, closed gaps among continents, and mobilized products among nations. Today’s luxury and prosperity comes in large part because of the abundance of oil as a transportation fuel. Our industry has been successful in meeting hydrocarbon demand growth thanks to the efforts of and collaboration among pioneers and business entrepreneurs. On the dark side, though, two dominant business practices help drive the industry—financial focus and competition—which, together, favor short-term profits at the expense of long-term strategic objectives. This has affected the industry in various ways. For example, global ultimate recovery averages only 35%, and the wildcatting success ratio is only one discovery for every five wells drilled.

Today, most companies are judged solely by financial metrics—profits—but those metrics often overlook important attributes of the business, such as people development, fundamental research, and long-term ultimate oil recovery. Competition has helped greatly but also has its drawbacks. Competition in an open market improves excellence and boosts efficiency. But at a time when resources are strained, competition can mean overlapping of resources and redundancy of effort. While competition springs from a mindset of a zero-sum game, collaboration blossoms in a win-win mental framework.

The future is challenging. Demand will rise higher and higher at a time when many producing basins will mature and decline. The challenge before the industry is how to leap forward and sustain future growth. It is imperative that our industry take a hard look at current practices such as financial metrics and competition and work hard to structure more innovative practices. We need practices that encourage development and retention of our people despite the cyclic nature of the industry, support fundamental research, minimize redundancy, and nurture collaborative working environments.

What do you believe is the most critical issue facing the industry?

I visualize our industry as a pyramid whose tip is reserves and financial metrics, underlain by technology in the middle part, with people forming the strong base and the foundation of the pyramid. This pyramid is floating in the ocean of business practices. Wall Street analysts, looking at the industry from the outside, just see the tip, the visible part of the iceberg. They are concerned with financial metrics and reserves, but they don’t see the technology essential to discover and develop the reserves, nor do they see the people who strive hard to fire innovation and ingenuity in our industry. When the market dips, people and technology are the first to suffer. When the market picks up, the industry wakes up and starts calling for more balanced human/business practices.

People develop new technologies, discover new reserves, and move the industry forward. It is essential that we focus first on people, then technology, and then reserves and financial metrics. The most critical issues facing our industry today are the scarcity of talent and the less-than-optimal engagement of the current workforce. The industry needs leaders who focus on people, tap their hearts, and fire their potential. Leaders can do this if they
are highly qualified, fair, and people-oriented.

Can you elaborate on the engagement of the current workforce?

SPE conducted a survey in December 2005 that rated members’ satisfaction with their current jobs, and 3,680 members responded. Almost 80% said they were happy in their current jobs, which is excellent. However, 55% believe that their potential is not being fully utilized. Others clearly wanted management to “walk the talk” and live the great values of fairness and integrity. Approximately 95% said that SPE should focus more on people issues.

The industry faces a scarce talent pool, and, therefore, it must look inward to see how it can fully use its current workforce. Basically, how can companies tap their employees’ full potential? When people are fully engaged, they draw on their utmost intellectual power, become more committed, develop more innovative technologies, and ultimately become happier and more satisfied in their jobs. It is worth noting that engagement does not necessarily mean harder work and longer hours; rather, it means smarter work, a happier feeling, and the spark of innovation.

How can SPE fulfill that role?

SPE can facilitate workshops for industry leaders to articulate a year-2020 vision of our industry, particularly in the areas of technology and people. This industry has been successful in the past, but we need to plan how we should go forward into the future. Some say that success can be your worst enemy. But we want success to be our friend; we want to build on that success as we move forward. We need a long-term vision.

In technology, we must determine what we need and how to get there. The industry has had major success in technology and in innovation in the recent past, but if we need quantum-leap technologies, groundbreaking technologies, in the next 10 to 15 years, we need an action plan to make it happen. The issues are: What technology does our industry need to focus on, and what are the roles of academia, operating companies, the service sector, and governments? How can we align the resources to make it happen, and what is the action plan? I believe we have been blessed with great commercial technologies in the drilling/production sectors of the business in the past decade. However, there is a critical need for fundamental research and long-term strategic R&D, especially in the area of maximizing ultimate oil recovery.

Regarding people, we must have a long-term plan irrespective of cyclic market conditions that involves academia and includes ideas on training, recruiting, retention, and, most important, the engagement of the current workforce. We need to emphasize human values such as fairness, trust, and integrity.

How would you try to persuade an executive or middle manager to join SPE or convince him/her to support employees’ participation in SPE programs and activities?

I would say that if you are looking for a global, universal, excellent organization that has talent, dedication, and resources—that is SPE. When I look at SPE, I see excellence well demonstrated through achieving noble objectives while maintaining high standards. SPE has been blessed historically, as well as currently, with the participation of many wise senior leaders of this industry, and we have benefited greatly from their wisdom.

What is the most critical issue facing SPE?

SPE is moving forward on many fronts. Financially, SPE has been very fortunate the last few years. Many new young-member activities are taking place in different parts of the world. SPE members continue to volunteer in many successful programs and will continue to do so in the future. We are working more with other technical societies in a multidisciplinary and integrated environment.

SPE works hard to engage senior leaders and decision makers. If SPE can work with industry leaders to articulate a vision, an action plan, and a strategy for the next 10 to 15 years, this would be very beneficial and reflect positively on the industry. With as many smart people as we have in SPE and in the industry, we have the means and the ways to sustain the prosperity of mankind and to maintain this reliable industry for years to come.

How do you see SPE evolving over the next several years?

The SPE Board is continually assessing SPE services to all members, with recent region-specific review including Russia, China, Latin America, and Africa. We are also trying to bridge the gap between SPE and other geoscience, technical, and even downstream organizations. The industry is realizing that the upstream has much in common with the downstream. The downstream applies intelligent field-type technology and smart control systems, and there is much to learn from the downstream. SPE will be working to build more joint programs with other sectors and with other societies.

What would you like to see more of from individual members?

I would like to see members becoming more active in pursuing lifelong learning and becoming more motivated in their support of SPE activities. The life cycle of knowledge is getting shorter, calling for continual use of SPE’s eLibrary. SPE members also should focus on polishing their soft skills.

Again, people are the most important asset in our industry. They need to continue to sharpen their technical competency while maintaining the highest ethical standards. SPE will strive to help members make a positive impact toward the ultimate objective of our industry.

2007 SPE President Abdul-Jaleel Al-Khalifa has been a manager at Saudi Aramco, Saudi Arabia, heading Reservoir Characterization for seven years, Area Exploration for two years and finally Reservoir Description & Simulation for two years. Before then, he served as Assistant to the Vice President of Petroleum Engineering and Development as well as in several division head assignments in the Reservoir Management and Simulation Dept. His areas of technical interest include exploration, reserves, reservoir characterization, modeling, and field development.

Since joining the Society in 1988, his participation in, and support for, SPE has covered a wide spectrum. He served as 2002–05 Director-At-Large on the SPE Board of Directors and was the Chairperson of the Board Committee on Technical Programs and Meetings in 2004 and 2005. He was the Conference Program Chairman for the 2005 International Petroleum Technology Conference. Al-Khalifa was an SPE Distinguished Lecturer, speaking on “Reservoir Management of Giant Oil Fields in Saudi Arabia,” during 1998–99. He received the SPE Middle East Regional Service Award in 1999 and was named an SPE Distinguished Member in 2001. In addition, Al-Khalifa was Director of the SPE Saudi Arabia Section during 1993–97, a Technical Editor for SPE Formation Evaluation during 1991–92, and Chairperson of the SPE Saudi Arabia Section Annual Technical Symposium during 1990–92. He also served as a Technical Editor for the Arabian Journal of Science and Engineering during 1993–94.

Al-Khalifa earned BS and MS degrees from King Fahd U. of Petroleum and Minerals, Saudi Arabia, and a PhD degree in petroleum engineering from Stanford U.