Oil firm cuts thousands of jobs

Schlumberger axed another 10,000 jobs and reported a net loss of $1 billion during the final three months of 2015, the world’s largest oil field services company reported.

According to Fuel Fix “since peaking at a global workforce of 130,000 in 2014, Schlumberger has cut more than 25 percent of its employees, or 34,000 jobs.”

Schlumberger, which has headquarters in Houston, Paris and the Hague, suffered a major net income loss for the fourth quarter after filing a $2 billion impairment charge on employee severance pay, contract terminations, facility closures and inventory write-downs.

For the full 2015 year, Schlumberger counted a net income gain of $2.1 billion, down more than 60 percent from $5.5 billion in 2014. Revenues for the year fell 27 percent from $48.6 billion down to $35.5 billion.

“In this uncertain environment, we continue to focus on what we can control,” Schlumberger CEO Paal Kibsgaard said in a prepared statement. “Throughout the year we took a number of actions to streamline and re-size our organization as we continued to navigate the downturn. In continuing to accelerate the benefits of the transformation program … we believe we will emerge as a stronger company relative to industry peers and competitors once the price of oil and the market conditions in our industry turnaround.

Kibsgaard said he expected Schlumberger’s acquisition of Houston-based Cameron International, previously valued at $12 billion, to close by the end of March. He said the large stock component of the deal — 78 percent in stock and 22 percent in cash — insulated the acquisition from market volatility.

The Cameron deal also hasn’t faced nearly the same levels of regulatory scrutiny as the planned merger of Schlumberger’s two Houston-based rivals, Halliburton and Baker Hughes.

Schlumberger took big losses in North America, where exploration and production companies have cut their capital spending by more than 40 percent, the sharpest reduction since 1986.

The U.S. benchmark for oil is priced at less than $30 a barrel. Last week, the number of U.S. rigs drilling for oil fell to 515, down more than two-thirds from its peak of 1,609 in October 2014 before oil prices began plummeting.

Schlumberger is planning to consolidate and move much of its Houston headquarters to its existing Sugar Land footprint in a move that analysts have suggested is part of overall cost-cutting efforts.


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