Qadhafi's Death Leaves Libyan Oil Industry Uncertain

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The death of Libyan dictator Muammar Qadhafi marks the end of an era, both for the nation and its once-booming oil industry, choked off by the turmoil of the revolution. And as with prospects for the liberated Libyans to form a united, democratic government, the post-Qadhafi era begins with a sense of cautious optimism in the petroleum fields so essential to the nation's recovery.

Oil exports accounted for more than 95 percent of Libya's export earnings in 2010, according to the U.S. Energy Information Administration (EIA). Since the fall of Tripoli in August, Libya's national oil company has moved quickly to restore output, according to the International Energy Agency (IEA), but thus far most production—down to around 300,000 to 400,000 barrels per day from a peak of about 1.6 million barrels daily—has been diverted to satisfy domestic demand.

Projections for the country's oil output have been revised slightly upwards, but questions remain about the extent of infrastructure damage caused by fighting, and power struggles within the nascent National Transitional Council could undermine efforts to get Libya's oil industry back online.

[Read: Qadhafi's Death Won't Mean End for U.S. Role in Libya.]

"If this leads to greater political clarity within Libya, and to a more stable operating and investment environment, then it may result in a more rapid restoration of the Libyan oil sector," David Fyfe, head of the IEA's oil industry and markets division, said in a statement. "However, many logistical, operational, and security-related challenges remain in that country, so we are not changing our underlying assumptions on Libyan production recovery for now. We still believe it could take many months for production to regain pre-crisis levels."

[Read: Politicians, World Leaders React to Qadhafi's Death.]

Most of the current oil production is derived from fields in the western and southern parts of the country, largely unaffected by fighting. While restoring production to pre-war levels may prove more difficult as the dust settles and damage is assessed, Libya has many advantages in its efforts to revitalize its oil industry.

For one, damage to the oilfields as a result of clashes between pro-Qadhafi forces and rebels appear to be relatively localized with the most damage affecting terminals and pipelines in the eastern side of the country. Production facilities in the western and southern regions have already started ramping up, according to Sarah Emerson, president of Energy Security Analysis Inc., who expects output to exceed 450,000 barrels by December.

"Now the question is as [production] continues to ramp up in excess of the refining requirements, then [Libya] can begin to export and that's where the money comes in," Emerson says. "[Qadhafi's death] is really incidental to the process. It starts a clock ticking, which says, 'Can you get the political stability together?'"

Emerson predicts conservatively that the country could see production of 800,000 to 1 million barrels by the end of next year, but full capacity very likely won't return until the end of 2013, she says.

[See photos of Muammar Qadhafi.]

The gradual re-entry of Libya—which holds Africa's largest proven oil reserves, according to the EIA—into global oil markets will likely ease pressure on supply and lower prices for refiners around the world.

"It's good news for the Europeans. It's good news for the East Coast United States," Emerson says.

mhandley@usnews.com

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Industry Must Do its Part to Educate the Workforce of the Future

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Howard D. Elias is President and Chief Operating Officer, EMC Information Infrastructure and Cloud Services. 

Innovation and productivity are the two key enablers of every successful economy, both of which rely on skilled people working in jobs that fuel a nation's long term health and wealth. America has always been blessed with innovative and productive people, but today uncertainty is dampening that spirit. That is because the issue of jobs is very real for the more than nine percent of unemployed, for the underemployed, for recent or soon-to-be college graduates looking for their first starting role-–anyone for whom the promise of a good-paying, personally satisfying job seems much less certain than it did just five years ago. 

But from another perspective, jobs are also an issue for U.S. employers that have a need for talented employees but find an insufficient supply of candidates with the requisite skills in science, technology, engineering, and mathematics (STEM) to help them compete in the digital world. Though it is a global economy, one requiring a globally talented workforce, America plays a critical role as a primary innovator and engine of growth in the 21st Century, and STEM education is at the core of what it will take to fuel America's innovation engine. 

Recognizing this situation, government, private enterprises and leading civic organizations and foundations are calling for graduating more engineers from American colleges and universities, and with good reason: STEM competency is critical to improving American employment and income. The U.S. Bureau of Labor Statistics reports unemployment in the technology sector at only 3.8 percent, with 7 percent to 13 percent job growth for engineers. Additionally, the U.S. Department of Commerce's Economics and Statistics Administration reports that STEM jobs increased at a pace three times faster than other jobs over the last three years. In an August 31 interview with New America Media, Dr. Alicia Abella, executive director of the Innovative Services Research Department at AT&T Labs summed up the issue stating, "The highest growing number of jobs is in the technology field, and there is more demand for those jobs than there is supply. We're going to need 800,000 more [U.S.] jobs by 2018 in computer technology alone. In the last three years we've only graduated 24,000 in those sectors and that's not nearly enough." 

As a technologist and employer, I understand well the challenge described by Dr. Abella. Paradoxically, with unemployment levels at their highest in 30 years, I and my peers have positions we are challenged to fill. Why? Because the skills we need are highly specialized; they are new skills that didn't exist just a few years ago, with titles like cloud architect and data scientist, reflective of the pace of innovation in today's digital economy. 

There is a long and rich history of industrialists investing in the creation of new schools and innovative curricula with the specific purpose of training students able to meet the needs of growing industries. Some of our country's most renowned educational institutions, such as Carnegie Mellon University, Worcester Polytechnic Institute, Purdue University, and many others exist today because of such foresighted investments. Successful companies in today's STEM-focused industries like high technology, biotechnology, environmental technology, and energy must once again foster close working relationships with educational institutions, sharing vision and collaborating to create programs designed and equipped to train the workforce of the future, for the future. 

To help satisfy our thirst for talented people in the short term, we can and do spend a great deal of time and money training technology professionals to master the specialized skills that are needed to provide the technologies and services our customers expect of us. At EMC I have overseen the development of a growing worldwide academic alliance that works with more than 600 colleges and universities in more than 40 countries across the globe to train people interested in acquiring specialized and sought after competencies. Such approaches may help a single organization, but they are not nearly enough to make a difference on a national scale. 

To ensure a steadily growing pipeline of students to fill our colleges and universities, successful companies and industries must do a better job investing in our local communities at the K-12 level designing, equipping, and staffing innovative programs like VEX Robotics and Citizen Schools that create a passion for STEM by giving our children hands-on experience with STEM-based problem solving. Industry must also work with civic-minded organizations, like Change the Equation, the National Action Council for Minorities in Engineering, the National Urban League and others to encourage broader participation in STEM education programs within under-represented communities such as African Americans, Latinos, and women. 

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Siemens to quit nuclear industry

  Siemens will continue to work in the power industry but drop out of the nuclear sector German industrial and engineering conglomerate Siemens is to withdraw entirely from the nuclear industry.

The move is a response to the Fukushima nuclear disaster in Japan in March, chief executive Peter Loescher said.
He told Spiegel magazine it was the firm's answer to "the clear positioning of German society and politics for a pullout from nuclear energy".
"The chapter for us is closed," he said, announcing that the firm will no longer build nuclear power stations.
A long-planned joint venture with Russian nuclear firm Rosatom will also be cancelled, although Mr Loescher said he would still seek to work with their partner "in other fields".
Siemens was responsible for building all 17 of Germany's existing nuclear power plants.
But more recently, the firm has limited itself to providing the non-nuclear parts of plants being built by other firms, including current projects in China and Finland.
The latest decision appears to imply a step back from building "conventional islands" - the non-nuclear plant in nuclear power stations - an area in which Siemens has remained active.
However, Mr Loescher also said Siemens would continue to make components, such as steam turbines, that are used in the conventional power industry, but can also be used in nuclear plants.
U-turn
He also gave his backing to the German government's planned switch to renewable energy sources, calling it a "project of the century" and claiming Berlin's target of reaching 35% renewable energy by 2020 was achievable.
The German chancellor, Angela Merkel, announced at the end of May that all of the country's 17 nuclear reactors would be shut down by 2022.
Before the Fukushima disaster, nuclear power accounted for 23% of electricity production in Germany.
The German government's decision marked a complete U-turn by the chancellor, who only in September 2010 had announced that the life of existing nuclear plants would be extended by an average of 12 years.
Siemen's move, announced on Sunday, is also a turnaround.
In 2009, the firm withdrew from an eight-year-old nuclear joint venture with French energy firm Areva, shortly before announcing its new deal with Rosatom.
"In view of global climate change and the increasing power demand worldwide, for us nuclear energy remains an essential part of a sustainable energy mix," Mr Loescher had said at the time.

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