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Lockdown and the Oil & Gas Industry

Ground Zero 

At the end of 2019, alarming news of pneumonia by unknown causes was reported. A new strain of coronavirus emerged in Wuhan, the capital city within China’s central region. The virus was called the novel coronavirus or nCoV. 

The Leap Year Pandemic

Fast forward to 11th March 2020, World Health Organization (WHO) Director-General, Dr. Tedros Adhanom Ghebreyesus, declared COVID-19 a pandemic [1]. All continents but Antarctica has confirmed cases of COVID-19 [2]. Only days after the announcement, Europe is announced as the centre of the epidemic with cases widespread all over the region. 

Outside of China, Italy, followed by Iran have the highest number of confirmed cases of COVID-19. The sudden and quick spread of the virus has rendered both countries incapacitated, with death tolls in Italy and Iran reaching a combined total of 3,500 and unfortunately rising [3]. 

Global Measures

The pandemic has pushed many governments into action; parts of Iran, the United States of America and the whole of the European continent has enforced a lockdown to curb the rising tally [4][5][6][7]. In Southeast Asia, a second wave of outbreak has hit Malaysia, making it the highest country in the region for confirmed cases of COVID-19. The second outbreak that led to a spike in confirmed cases is linked to the religious gathering held between February 27th and March 1st outside of Kuala Lumpur, with a staggering 16 000 people in attendance [8]. As of Monday, 16th March, its government imposed a Movement Restriction Order across the country [9]. 

Social Distance and The Economy

In ground zero, China, aggressive containment measures have been implemented with positive outcomes in countering the exponential spread. As of March, the country has been under quarantine for over one month and a half [10]. In Malaysia, the Movement Restriction Order is enforced between 18th March until 31st March, while the situation will still be closely monitored. The move to restrict movement across the nation comes as no surprise as many other countries around the world have enforced it, including Britain, whose controversial decision to tackle the virus with a “herd-immunity” approach [11]. 

However, the arduous act of implementing the protocols could also be a challenge, with quite a number of its citizens refusing to cooperate amidst panic [12]. It truly is a test of mind and capability for nations across the globe in controlling the contagion. 

In a move to spread awareness and keeping global citizens informed, John Hopkins University & Medicine introduced its interactive map showing live updates on the spread of the virus:

John Hopkins University Interactive Map Tracking COVID-19 with Daily Updates [13]

This map helps us visualise just how dire the extent of the virus has reached. Here in Malaysia, the government has allowed only several essential services to remain open, aside from pharamacies and provision stores to support the people[14]. Small to Medium Enterprises (SME) are heavily affected as businesses everywhere are to abide by the movement control mandate. According to World Economic News, tourism will be affected the most, with Asia being one to feel the brunt of the blow [15]. Educational institutions, from preschool to tertiary, have had to cancel classes. In the oil & gas industry, while it is still considered an essential service, it was the first to be affected by COVID-19, seeing the epicentre of the outbreak being in China; the world’s largest consumer of energy [16]. 

In Oil & Gas

Furthermore, companies like Equinor, working on a North Sea offshore rig, received worrying news when one staff was tested positive for COVID-19. This caused grounded flights, staff being sent home to work and non-critical work to be deferred [17]. Similarly, more and more energy companies are being affected, and not just in terms of oil prices. 

According to E&E News, the White House intends to bolster oil prices. However, with no demand for fuel due to the vast states of lockdowns across the world, the effort seems futile. The head of energy research at Rystad Energy, Magnus Nysveen stated that oil demand will remain on a downward trend (and possibly enter the negatives) as efforts to combat the virus continues to rage [18]. Major crude oil importer, China, has also been credited to having huge repercussions on oil prices, according to charts presented by CNBC [19]. 

How Are We Coping?

The migration from working in a shared space to remote collaboration is understandably not a simple feat. Many businesses in various industries are being disrupted, while the rest are trying to adapt to the unfamiliar environment. 

Even at the Malaysian headquarters, SynergenOG continues to provide its services while adhering to the government mandate. It is imperative that we stay connected with clients now more than ever; updating and facilitating workshops from a distance. 

Crisis Management and Digitalising Workflow

Undergoing digital transformation quickly stood out as the most viable option for many businesses; making use of online collaboration tools, using flow tracking softwares and even meeting via conference call. The options are readily available, and most are free of charge (Google Meets, Zoom, Skype, etc.). Each one of us wants to do our part in containing the spread of the virus but while we try to carry on with business as usual, there’s no denying the challenges faced. 

At SynergenOG, crisis management plays an important role. One may not be able to see the future, but predicting a situation accurately requires a tremendous amount of skill and experience. In predicting the outcomes, the management looked at reducing possible risks as low as reasonably practicable. This is then followed by providing the necessary tools and resources. 

Thong Wee Jun, a Senior Engineer at SynergenOG credited the successful execution of ongoing projects in Brunei and Indonesia to the knowledge and resources bank at the company, enabling an effective work from home environment under the current circumstances. 

Another factor that should be considered when working from home is communication. As SynergenOG our Co-Founder and Director of Technical Services, Keith Bell, always says, effective communication is key to working seamlessly. He also mentions that many of his engineers are required to travel (case-to-case basis). 

We are always engaged in heavy discussion or a quick fact-check when working around a problem. By doing so, we align the team goals and objective with that of the client. This is imperative in achieving the desired outcome. 

Puvan Balasubramaniam, SynergenOG Co-Founder and Director, also advised not to lose sight of other risks. No matter the circumstances, they are often temporary. So despite how tough a challenge may seem at the moment, all the efforts should not be concentrated on it in particular. 

SynergenOG and team, in accordance with the Restriction Order effective 18th March to 31st March, wishes everyone a safer and connected experience. We are confident that we can weather this storm 

 

REFERENCE

  1. WHO: Director-General’s Opening Remarks www.who.int/dg/speeches/detail/who-director-general-s-opening-remarks-at-the-media-briefing-on-covid-19—11-march-2020 
  2. CNN: Every continent except Antarctica has reported coronavirus cases edition.cnn.com/asia/live-news/coronavirus-outbreak-02-26-20-intl-hnk/h_cae39a08e358777f9cd1409c561b8c19
  3. John Hopkins University: COVID-19 FAQ https://coronavirus.jhu.edu/map-faq.html 
  4. DailyMail: Trump calls for lockdown www.dailymail.co.uk/news/article-8118415/Donald-Trump-tells-America-lockdown-15-days-stop-coronavirus.html 
  5. WHO warns Europe: www.theguardian.com/world/2020/mar/13/european-countries-take-radical-steps-to-combat-coronavirus 
  6. WHO: Rolling Updates on Coronavirus Disease www.who.int/emergencies/diseases/novel-coronavirus-2019/events-as-they-happen
  7. USNews & World Report: Virus toll in Iran climbs as lockdown deepens in Middle East www.usnews.com/news/health-news/articles/2020-03-16/reports-member-of-iranian-clerical-assembly-dies-from-virus
  8. The Straits Times: Malaysia Confirms 77 Cases From Mosque Event in KL https://www.straitstimes.com/asia/se-asia/malaysia-confirms-77-cases-from-mosque-event-in-kl 
  9. NST: Malaysia bans travel abroad, lockdown until March 31 www.straitstimes.com/asia/se-asia/malaysia-to-impose-lockdown-from-wednesday-to-march-31
  10. TIME: Life in China Has Not Returned to Normal https://time.com/5804136/china-coronavirus-quarantine-new-normal/ 
  11. Foreign Policy News: Britain Drops It’s Go-It-Alone Approach to Coronavirus  foreignpolicy.com/2020/03/17/britain-uk-coronavirus-response-johnson-drops-go-it-alone/ 
  12. Malay Mail: A Mad Rush Home to JB From KL www.malaymail.com/news/malaysia/2020/03/18/on-eve-of-covid-19-shutdown-a-mad-rush-home-to-jb-from-kl/1847790 
  13. John Hopkins University & Medicine: https://coronavirus.jhu.edu/map.html
  14. TRP: Here’s What’s Still Allowed to be Open During the Movement Control Order www.therakyatpost.com/2020/03/17/heres-whats-still-allowed-to-be-open-during-the-movement-control-order/ 
  15. WEF: This is how coronavirus could affect the travel and tourism industry  www.weforum.org/agenda/2020/03/world-travel-coronavirus-covid19-jobs-pandemic-tourism-aviation 
  16. Offshore Technology: How COVID-19 is affecting the offshore industry www.offshore-technology.com/features/coronavirus-impact-offshore/
  17. The Maritime Executive: Equinor Suspends Flights to Three Fields Pending COVID-19 Test Results https://www.maritime-executive.com/article/equinor-suspends-flights-to-three-fields-pending-covid-19-test-results 
  18. CNBC: 6 Charts show the coronavirus impact on the global economy and markets so far  www.cnbc.com/2020/03/12/coronavirus-impact-on-global-economy-financial-markets-in-6-charts.html
  19. E&E News: Oil Industry Braces For Pain https://www.eenews.net/stories/1062615237
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