Calgary –It’s pink slip time for oilfield service provider Baker Hughes Inc. which is cutting 7,000 jobs worldwide due to a sharp decline in crude oil prices.
The company to be acquired by Halliburton Co. later in 2015 for approximately $35 billion may also close some facilities
Baker Hughes reported on Jan. 20 that most of the job cuts will come in the current first quarter of 2015. The company won’t say how many workers Baker Hughes employs in Canada or what number will be affected by the cuts.
Baker Hughes employed 61,100 employees worldwide as of Sept. 30, 2014. The company opened its new power centre in Lloydminster on Sept. 18 just weeks ahead of the announced takeover by Haliburton. Halliburton announced in December that it would cut 1,000 workers or about 1 per cent of its 80,000 employees worldwide.
A Halliburton spokesperson reported in November that the company employed 1,800 people in Canada. These cuts follow on the heels of news just days earlier that industry leader Schlumberger is cutting 9000 jobs or eight per cent of its global workforce that numbers about 123,000.
The company didn’t say how many jobs in Canada would be affected either. Schlumberger employed over 3,700 employees in Canada as of last March according
to Industry Canada. Suncor Energy earlier announced plans to cut 1,000 workers from its Canadian oilsands projects.
Baker Hughes posted record revenue of $6.6 billion for the fourth quarter ending Dec. 31, 2014. Meanwhile, Halliburton reported its fourth-quarter revenue
rose 14.8 per cent to nearly 8.8 billion from $7.6 billion from the fourth quarter of 2014. Halliburton and Baker Hughes generate about half of their revenue from North
America where the oil slowdown is expected to have more impact on operations than the rest of the world.
Baker Hughes expects to incur a onetime severance charge of $160 million to $185
million US in the first quarter when the bulk of the layoffs will take place.
Halliburton reported that it took a $129 million restructuring charge in the fourth quarter to lessen the impact of a reduction of activity expected in 2015.
