Oil services firm Subsea 7 announced May 28 that it will cut its global workforce by a quarter and reduce its fleet of specialized vessels by up to a third to preserve cash following the slump in the oil market.
The company said it planned to lay off about 3,000 workers, both contractors and permanent employees, by the end of second-quarter 2021. The company has operations in about 30 countries but did not say where jobs would be cut.
Oil companies have reduced spending on new projects after oil prices hit decade lows earlier this year due to excess supply as travel and other restrictions imposed to contain the coronavirus pandemic slashed demand for fossil fuels.
“Faced with a significant deterioration in the oil and gas market, we are taking swift and decisive action to address the elements under our control,” Subsea 7’s Chief Executive John Evans said in a statement.
The London-headquartered company is controlled by Norwegian investor Kristian Siem, its chairman, and is listed in Oslo.
The company also said it would also reduce its fleet of 32 vessels—which lay pipes, lift heavy loads and launch ROVs among other tasks—by up to 10 vessels.
Subsea 7, which employs 12,000 people globally, said the measures are expected to result in about $400 million in annualized cash cost savings from the second quarter of 2021.
The company, which made an adjusted core profit (EBITDA) of $631 million in 2019, will also reduce its capital spending to minimal levels in 2021 and 2022, it added.
Recommended Reading
Crescent Energy Closes $905MM Acquisition in Central Eagle Ford
2025-01-31 - Crescent Energy’s cash-and-stock acquisition of Carnelian Energy Capital Management-backed Ridgemar Energy includes potential contingency payments of up to $170 million through 2027.
Constellation Bets Big on NatGas in $16.4B Deal for Calpine
2025-01-10 - Constellation Energy will acquire Calpine Corp. in a $26.6 billion deal, including debt, that will give the pure-play nuclear company the largest natural gas power generation fleet.
Report: Will Civitas Sell D-J Basin, Buy Permian’s Double Eagle?
2025-01-15 - Civitas Resources could potentially sell its legacy Colorado position and buy more assets in the Permian Basin— possibly Double Eagle’s much-coveted position, according to analysts and media reports.
Petro-Victory Buys Oil Fields in Brazil’s Potiguar Basin
2025-02-10 - Petro-Victory Energy is growing its footprint in Brazil’s onshore Potiguar Basin with 13 new blocks, the company said Feb. 10.
Apollo Funds Acquires NatGas Treatment Provider Bold Production Services
2025-02-12 - Funds managed by Apollo Global Management Inc. have acquired a majority interest in Bold Production Services LLC, a provider of natural gas treatment solutions.