Rigs, vessels, equipment and material were all in high demand but the most serious problems were competition for people and contractor capacity constraints, according to Thompson.

“When the oil price was down we let a lot of good people go and we are paying for it now,” he said.

“We are left with a limited experience base to work with.”

Thompson said while the loss of skills among operating companies had been extensive, contracting companies had been even more harshly hit. The end result was that the contractors that had survived the last downturn were now in a much stronger bargaining position.

“The wheel has turned and contractors are doing well,” he said.

“Often contractors pick operators nowadays. They can choose the companies they feel comfortable working with and that they want to have long-term relationships with.”

To deal with these problems, operators were increasingly turning towards engineering, procurement, construction and management (EPCM) and Engineering, Procurement, Installation and Commissioning (EPIC) contracts and developing standardised hardware that could meet 95% or more of project requirements rather than developing custom hardware on a project-by-project basis, he said.

More importantly, traineeships, apprenticeships and graduate development programs were returning to favour.

Thompson said school-leavers were increasingly inclined to undertake engineering training.

“Not long ago, everyone wanted to be in IT, but now students are seeing the high incomes and good lifestyle that engineering careers can offer,” he said.

But while there were now many good new graduates in the oil and gas sector, there was a dearth of talented people with five to 10 years experience who would be the industry leaders when today’s veterans had retired.

Thompson said Woodside was aiming to make itself an employer of choice for ambitious professionals, by being seen as an innovative and dynamic company, but he believed the skills shortage would trouble the industry for years to come.