OSLO (Reuters) – Norwegian oil and gas firm Equinor is set to cut jobs significantly in the United States, Canada and Britain to adjust to a fall in oil prices, a company spokesman said on Wednesday.
The group plans to cut employee numbers in those countries by about 20% and contractor numbers by around half to ensure profitability at lower oil prices, the spokesman told Reuters, adding that the targets were communicated internally on Tuesday.
Equinor will also not drill any new unconventional wells this year in the United States, where it has acreage in the Bakken and Marcellus shale formations, he said.
The plans, which the company has been working on since the spring, would not involve asset sales, he added.
“There is no change in our acreage portfolio. The action that we are taking now is to ensure that our business is profitable in a lower price scenario,” the spokesman said.
Some staff cuts would come as a result of the sale of Equinor’s Eagle Ford assets last year, he said.
The spokesman said he could not specify the number of employees and contractors that could be affected, but said Equinor’s U.S. office was the second largest after Norway.
Equinor had 21,000 employees at the end of 2019.
The majority state-owned firm came under intense scrutiny in the Norwegian media earlier this year over mounting losses in the United States, with Norway’s Oil and Energy Minister Tina Bru demanding more transparency on foreign investments.
Brent crude LCOc1 price plunged to a more than two-decade low and U.S. oil prices turned negative in April due a sharp fall in demand during the COVID-19 pandemic.
Oil prices have since recovered and are holding near five-month highs as U.S. producers shut most of their offshore Gulf of Mexico output ahead of Hurricane Laura, and following a drop in U.S. crude inventories.[O/R]