The Magazine for Underwater Professionals
28th June 2016
Norway-headquartered oil and gas contractor Subsea 7 has announced a second phase of global resizing and cost reduction measures due to continued difficult business and economic conditions in the oil and gas market.
The company plans to reduce its worldwide workforce to roughly 8000 by early 2017, from the current level of 9200. Consultation with employees and employee representatives will take place on a local basis and consultation processes have begun in Norway and the UK.
Up to five vessels are scheduled to leave Subsea 7’s current active fleet by early 2017, as existing contracts expire. The firm expects the latest cuts, plus those initiated earlier this year, to realise US$350 million (£263 million) of annualised cost savings. It said the charge related to its resizing will be recognised in 2016 and is expected to be less than US$100 million (£75 million). There will also be a reorganisation of its existing business units.
“The reduction in the size of our workforce is a necessary step to maintain our competitiveness and protect our core offering through the oil price cycle,” said chief executive officer Jean Cahuzac.