ConocoPhillips Cuts 10% Of Work Force

ConocoPhillips said Tuesday it is planning to cut  1,800 employees, or 10 percent of its global workforce, in the next several weeks as it copes with low oil prices.

Daren Beaudo, a company spokesman, confirmed that an internal communication was sent to employees earlier this week informing them of the upcoming staff reductions. Most of those affected workers will receive layoff notifications next month.

The largest portion of the job cuts will come from North America, he said, where the Houston oil producer drills for crude from the oil sands in northern Canada to the shale plays in South Texas. The firm will also trim about 1,000 core contractors from its workforce.

Beaudo said ConocoPhillips has informed employees, city and state agencies that more than 500 of the firm’s 3,750 employees in Houston will also be cut. In Canada, the firm is cutting 400 employees and 100 contractors.

“We’ll know more in the next several weeks as we work through our formal process,” Beaudo said in an emailed statement. “Our industry is undergoing a dramatic downturn, which has caused us to look at our future workforce needs. As we have assessed the implications of lower prices on our business, we’ve made the difficult decision that workforce reductions will be necessary.”

He said the company has also taken other steps to improve its position, including spending cuts and reducing its deep-water exploration plans. The company in recent months has begun restructuring itself to adjust for lower oil prices, which have fallen from $100 a barrel last year to around $45 a barrel.

In July, ConocoPhillips CEO Ryan Lance had said the company would make some structural changes that would contribute to reducing its operating costs by $1 billion.

“I think we’re ahead of plan and our expectation is that we’ll generate more savings beyond the $1 billion,” Lance had said. The company had reported a second-quarter loss of $179 million, or 15 cents a share, compared to a net gain of $2.1 billion in the same period last year. It had already cut around 1,000 jobs from the beginning of the year.

ConocoPhillips’ layoffs will add to the 176,000 workers around the globe that have been cut because of the oil slump, according to energy recruiter Swift Worldwide Resources.

Source: Fuelfix