More Oil Industry Fallout
Maersk Oil, an oil and gas company owned by the A.P. Moller-Maersk Group, is cutting about 200 employees and will seek permission from Britain’s Oil and Gas Authority to close operations at its Janice installation. The Janice installation produces about 7,000 barrels per day from three UK North Sea oil fields. The staff cuts will affect permanent Maersk Oil employees as well as contractors.
Maersk Oil operates fields in the UK, Denmark, Qatar, Kazakhstan, the U.S. Gulf of Mexico, Algeria and Brazil with total production of 550,000 barrels of oil per day.
The Janice offshore installation is a 30-year-old rig and Maersk has operated the facility since 2005. If approved, production at the Janice installation would cease in the second or third quarter of 2016.
Maersk said in a statement once it received permission to cease production in the field it would start its decommissioning program for the Janice FPU (floating production unit). The company said it will also consider a move to a three weeks off, three weeks on offshore rotation which would be implemented in the second quarter of 2016.
On August 21, Oil prices fell below $40 per barrel for the first time since 2009. And the oil industry has felt the effects as operators have slashed jobs and cut operations costs.
In June, the Energy Information Agency (EIA) said the US petroleum industry lost about 6.5% of its jobs in the first half of 2015, which is about 35,000 of its 538,000 workers. Rig count in the U.S. are also down about 42 percent this year.
And in the UK, Shell eliminated about 6,500 and Centrica terminated 6,000 jobs. This month, the Wood Group, a Scotland-based oil and gas services company operating the UK North Sea said it was reducing its workforce by 5,000. The company’s net profit fell by 17 percent in the first half of 2015.
In July, the Sapiem energy services group announced that it would cut nearly 9,000 employees over the next three years. Sapiem is a subsidiary of Italy’s multinational oil and gas company ENI.