Robots on rigs could save US oil companies $7b in wages

Texas: The US oil industry could save more than $7 billion in wages by replacing human roughnecks with robots on rigs, according to a report from Rystad Energy.

At least two out of every 10 oil workers globally in drilling, operational support and maintenance could be replaced by automation in the field over the next decade, the energy data provider said in a report. That would translate into more than 100,000 in total jobs replaced in the US, for example.

"Even when the COVID-19 downturn is finally past us, operators will have to continue exploring new avenues for cost reductions," Sumit Yadav, an analyst at Rystad, wrote in the report. There are, however, hurdles to overcome, including regulatory approvals as well as resistance from labor organizations.

Headcount reductions in the US from robots would be a further blow to an industry that has struggled to return to pre-pandemic levels. Rig use both in the shale patch and in the US Gulf of Mexico is still down by almost half compared to the start of last year.