Predicting “uncertain times” for 2015 is no prediction at all. In this industry change is the only constant. It always has been. As we pass through the gate of the year I can’t tell you what the oil price will be tomorrow let alone in 90 days time. However, there is plenty more that is predictable.
Fortune favours the brave. For my holiday reading I re-read Jeremy Cresswell’s “North Sea Oil Moguls” (first published in 2005). For those looking to predict the industry’s next moves you could do worse than see what the last generation of oil barons did when faced with similar challenges. This is a cyclical industry, and the parallels with previous price falls are clear: “the crash opened the door for a new independent…”. It’s a great read. There are echoes of Sir Mervyn King’s recent statement that the global financial crisis was an “exciting opportunity” for him when he was Governor of the Bank of England.
It was Winston Churchill that said “never let a good crisis go to waste”. Most of our organisations could be leaner and fitter. We lawyers see it when it comes to due diligence on business acquisitions. We see projects that should have long since been abandoned. Senior management ego’s and office politics keeping them funded long after anyone really believed they would succeed. What would be a cost-cutting harvest for a new owner should now be gathered by the incumbent (restructured) team. Market changes moves personnel on and/or gives an excuse to shelf (bin) projects that can charitably be referred to as “ahead of their time”.
On a lighter note, politicians will predictably want to talk, listen and talk some more in 2015. Whilst I’m keeping my own counsel on Aberdeen City Council’s summit (in case they stop collecting my bins), I’m happy to predict some good news for us in the upcoming Budget (18 March). Some will inevitably say it is too little too late, but with the attention of our industry’s 440,000 voters shortly before a general election I’m sure the UK government will want to be seen to help.
The media (present company excepted) will initially remain focused on the bad news in 2015. Aberdeen’s Audi dealer will get fed up with calls from London newspapers asking if sales are down. Little do Londoners know that for many in Aberdeen belt tightening means trading down to an Audi. Once the media get bored with being negative they will switch to (equally unsubstantiated) optimism. Those of us allocating our industry’s resources (including our own time) need to take a more informed and balanced view. I was recently offered the filing of a planning application for a BBQ hut as evidence of an oil company’s long term commitment to Aberdeen. We are better than that.
Finally, from the sublime to the ridiculous, allow me a prediction on our most celebrated “Mogul Ambassador”, Sir Ian Wood. It seems he was hardly out of the spotlight in 2014, despite his retirement from Wood Group in 2012. We are going to need to invent some new awards for him. Other than MasterChef he seems to have them all.
Is 2015 going to be an interesting year? Yes. Will we need courage and a sense of humour? You bet. 2015: Bring it on!
Peter Murray is a partner at Scottish law firm Ledingham Chalmers where he specialises in UK corporate law and international projects.
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