Skip to comments.BP to cut Alaska workforce by 13%
Posted on 02/03/2016 5:41:33 AM PST by thackney
BP is cutting 4,000 jobs worldwide and some of those reductions will be in Alaska.
An intra-company email obtained by the Journal sent to BP Alaska employees Jan. 12 states that the company plans to reduce its total in state workforce by 13 percent.
All employees should know their status by early spring and the majority of layoffs will be conducted by mid-year, according to the email.
BP directly employs about 2,100 people and has another 6,000 contract workers in Alaska, based on the company's 2015 Alaska Hire report. The 13 percent reduction will come from the company's direct employees, or about 270 people.
"Today, the cash we generate from our business is not sufficient, meaning we have to borrow from the BP Group to meet our Alaska investment," the email reads. "Improving our cost base is critical to maintaining our activity level at Prudhoe Bay and the long-term viability of the region."
In a formal statement BP said it plans to further reduce employee numbers in its upstream division to less than 20,000 -- the Gulf of Mexico, Lower 48 onshore and Alaska in the U.S. -- to simplify its business, cut cost and improve efficiency.
"To reach this level we will need to reduce our current workforce of BP employees and agency contractors by at least 4,000 additional people," the company said.
BP's restructuring comes as the price for Alaska North Slope oil has fallen to near $31 per barrel.
At the same time, North Slope crude production and transportation costs are estimated at $46 per barrel, according to the state's Fall 2015 Revenue Sources Book.
BP cut 475 Alaska positions in late 2014 when it sold North Slope assets to Hilcorp Energy. About 200 of those employees ultimately transitioned to work for Hilcorp, a Houston-based independent.
ConocoPhillips announced a 10 percent cut to its 1,200-employee Alaska workforce last September in a cost-cutting move.
BP has incurred pre-tax damages upwards of $55 billion related to the massive 2010 explosion and subsequent oil spill from its Deepwater Horizon drilling rig in the Gulf of Mexico, according to the company's third quarter financial report.
Overall oil and gas industry employment was down 900 jobs statewide in November from a year prior, based on preliminary Labor Department numbers.
Funny how people lament the loss of mining jobs but never a peep about the 12 million manufacturing jobs lost to off shoring since 2001. Hypocrites.
I’ve posted about losses in steel plants, manufacturing multiple times. Plants closing and laying off people.
Much of that comes from the loss of orders from the oil/gas companies.
U.S. Steel may cut nearly 700 Texas jobs
Oil shock is hurting U.S. economy: Kemp
...In the United States, businesses engaged in oil and gas extraction and refining spent almost $200 billion on new equipment and structures in 2013...
...The downturn in oil and gas is rippling all along the supply chain.
The oil and gas industry is not just a major producer of inputs used by other manufacturers, service suppliers and households, it is also a major consumer of raw materials, manufactured items and services itself.
Dresser-Rand plans to shutter plant, lay off 72 workers
U.S. Steel postpones Alabama project
Oil field losses have been pretty hard, the economy back home in Wyo is really hurting... a LOT of good people are hurting.
Wow. That really bites. This is the goal of the oil cartels and probably our POTUS too. Bankrupt and destroy Americans.
Alaska is on the verge of a bust economy. Due to precipitous drop in price of oil we are facing $3.5 billion deficit. Our new hybrid dem/repub governor has the plan. Raise taxes, institute sales tax, raid the permafund and make no spending cuts. That should do it, always works wherever it has been tried.
Lots of great people, but too many “Redneck Socialists” as another FReeper described.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.