The Job Cuts Continue
Stung by the worst downturn in oil in six years, crude producer ConocoPhillips said on Tuesday it will trim its current workforce by 10 percent in a second round of layoffs - only months after a first round of cuts reduced staff by five percent.
The cumulative impact of the reductions, to be felt most severely in North America, will be around 2,810 jobs, or nearly 15 percent of the 19,100 staff the company, a top U.S. independent, had at the end of last year.
ConocoPhillips has 3,753 workers in Houston, its headquarters, where about 500 layoffs are expected.
Earlier this year, the company reportedly scrapped plans to develop a $2.1 billion Norwegian North Sea gas and condensate development.
Ion Geo Follows Suit
The news from ConocoPhillips was followed by similar news of job cuts in the oil and gas industry when, on Septmeber 2, Ion Geophysical announced an aggressive cost reduction initiative expected to result in an approximate 25 percent decrease in the company's global workforce. The job losses are expected to occur September 30.
The company expects to incur $5-6 million in termination costs but to to reduce annual operating costs by approximately $40 million.
Across the Industry
The moves comes as part of an industry-wide round of layoffs across the oil and gas industry as a result of prolonged low oil prices. Earlier this week, Aker Solutions announced job cuts in its Norwegian subsea business. About 500 permanent positions at facilities in Fornebu, Stokke, Moss and Tranby in Norway will be affected.
In July, Technip said it plans to cut approximately 6,000 jobs globally.
Globally, companies are cancelling their investments in long-range projects, and recent auctions for offshore fields held in Mexico and the United States attracted little interest.