Norway Oil Producer to Slash 2,000 More Jobs

Published Date : Jun 16, 2015

Norway’s state controlled oil producer Statoil ASA will be cutting as many as 2,000 more employments by the end of 2016 as a way of bringing down costs in reaction to reduced crude prices.

The Stavanger based crude company said that Statoil plans to say good bye to 525 consultants and around 1,100 to 1,500 permanent employees by the end of next year. In a statement the company added that more organizational changes are likely to be announced by the end of June.

Anders Opedal, chief operating officer and executive vice president said that the improvements are needed to empower the competitiveness of Statoil and secure the company’s future value creation. Since the end of 2013, the company has already axed around 2,300 consultants and employees from its payroll.

Since the prices of crude dropped in the second half of last year, these job cuts at the No 1 oil and gas producer in Norway have added to over thousands more in the country’s offshore energy industry. Norway is Western Europe’s biggest oil producing nation and it is bracing itself for the largest reductions in offshore investments in around 15 years.

Announced job cuts at service providers and oil companies have no surpassed 20,000 since the beginning of last year, according to DNB Markets in Oslo. In 2014, the oil and gas industry in Norway employed 250,000 people directly and indirectly, which accounted for nearly 20 per cent of the country’s gross domestic product, according to data revealed by the government.

Statoil is presently trading 27 per cent lower than its price this time last year. The shares have dropped by 0.4 per cent to reach 140.4 kroner at around 1:42pm in Oslo on Tuesday, marking a four day losing streak.

The sweeping efficiency program started by the government owned company expects to yield savings amounting to US$ 1.7 billion per year beginning in 2016.