Global Challenges Facing the Oil and Gas Industry
Authors: Baxter Mark 
Published: February 2015

In the current environment of corporate misdeeds and nondisclosure, the public yearns for honesty, integrity, and open communication. In the absence of these attributes, assumptions are drawn and beliefs are formed based on appearances. For example, the public often assumes that oil and gas companies have a value system nurtured by greed and power. How else to explain the exorbitant prices charged at the gas pump? And no wonder negative perceptions exist; the industry image the public often sees is one littered with such incidents as Exxon’s Valdez spill, Enron’s accounting debacle, the Russian oil giants vs. the Russian Federation, and Royal Dutch Shell’s disclosure of reserves. Geopolitical events around the globe related to labor strife, terrorist risk, pipeline disruptions, and war contribute to the population’s suspicion of the industry.

A lack of communication attributed to the energy industry has masked the facts, and miscommunication by special-interest groups has disguised the truth. If the energy industry were to transform its efforts from reactive lobbying to improving its public image, it could circumvent a great deal of negative campaigning and ridicule. For a combative strategy, the industry might consider adopting a policy of open communication, detailing energy’s value to society and educating the general public.

A Failure to Communicate

Historically, the energy industry has consistently contributed to society in a positive manner. However, it has failed to communicate in a proactive and unified voice. The industry has not established a platform to educate and inform the world community of its achievements and accomplishments. The industry should promote its contributions, technological developments, and implementation of good business practices. Then, the people of the world might begin to appreciate that the comforts that energy provides are the result of hard-working and dedicated personnel in the energy sector. In addition, energy companies should keep promoting the developments that have increased global standards of living, and in the developing countries with fossil fuel reserves, the industry should develop these natural resources in parallel with the development of social infrastructure.

Does the world population understand that petroleum provides variations of plastics and other materials used in everyday conveniences and in medical devices that prolong human life? Do young people understand that fertilizers manufactured from natural resources contribute to high agricultural yields, producing food for millions of people around the world? The industry must make a concerted effort to educate the misinformed and provide the public with the knowledge base to make informed decisions.

Thousands of jobs have been created both directly and indirectly by the industry, as well as billions of dollars paid through taxes into nations’ coffers. The industry needs to convey how much time and effort employees contribute to the community and the commitment by both executives and employees to adhere to high ethical standards, and finally, it needs to make assurances that the industry is concerned about protecting the environment. If and when a mistake is made, the industry needs to readily admit the mistake, apologize, and advocate proactive measures to correct the occurrence and mitigate the consequences. Corruption of foreign officials should never be tolerated by any company, regardless of the country of origin. Our youth need to be educated on the industry overall, inspired with interest, and given the opportunity for career paths.