“Paradoxically, history tells us that the biggest technology breakthroughs occur when the oil price is low and we need to be pragmatic to make things work,” Ellice-Flint told conference delegates.

“[But] this is a time where we should see major technological advances and develop new talent in the industry.”

One solution was for companies to reinvest in research and development, according to Ellice-Flint. He said many R&D centres owned by the majors have been closed down or scaled back since the 1980s.

Ellice-Flint also warned that the current skills and labour shortage was likely to get worse unless industry took action now. A main reason for the current labour shortages was the retrenchment of about 2 million employees one to two decades ago, he said.

“The average age of our geo-professional workforce is around 50 [years old], many of whom will be retiring within the next five to 10 years,” he said.

“That has resulted in a huge knowledge and infrastructure gap that we are now trying desperately to fill.”

Ellice-Flint warned that while high oil prices had also resulted in record levels of exploration and development across Australia, industry should resist cutting corners for short-term gain.

“A high oil price environment can result in eroding technical excellence,” he said.

“There is no substitute for thorough geotechnical work and the focus must always be on value-based decisions based on rigorous technical work. This approach is often very difficult to maintain under the short-term pressures of the marketplace.”

Ellice-Flint also recognised that high oil prices were responsible for driving investment in natural gas-related industries, such as liquefied natural gas and GTL (gas-to-liquids).

“In taking a long-term perspective, I see gas as the key energy source as we transition from the age of oil to find other environmentally acceptable and economically viable energy sources such as clean coal,” he said.