Date
25 September 2017
Baker Hughes, which is being acquired by Halliburton in a deal worth almost US$35 billion, plans to lay off 7,000 employees. Photo: Bloomberg
Baker Hughes, which is being acquired by Halliburton in a deal worth almost US$35 billion, plans to lay off 7,000 employees. Photo: Bloomberg

Halliburton, Baker Hughes to lay off thousands as oil slumps

Oilfield service providers Baker Hughes Inc. and Halliburton Co. plan to cut thousands of jobs as drilling activity slows further amid a steep fall in crude prices, Reuters reported.

Global oil prices have tumbled almost 60 percent since June, hitting five-year lows as growing production and tepid global demand resulted in a supply glut and prompted oil producers to scale back spending.

“We expect our headcount adjustments to be in line with our primary competitors,” Halliburton’s chief operating officer Jeffrey Miller was quoted as saying.

The company, which employees more than 80,000 people, said it cut 1,000 jobs in its operations in the eastern hemisphere in the fourth quarter.

Baker Hughes, which is being acquired by Halliburton in a deal worth almost US$35 billion, said earlier in the day it would lay off 7,000 employees.

The job cuts, which come days after industry leaderSchlumberger NV said it would cut 9,000 jobs, underscore the abrupt slowdown in drilling activity seen in the past two months.

The number of land rigs in the United States has fallen by 250, or about 15 percent, over the last 60 days, Halliburton chief executive Dave Lesar said.

Halliburton and Baker Hughes derive about half of their revenue from North America, a region they expect to fare worse than the rest of the world in the oil slump.

Baker Hughes said most of the workforce reduction would take place in the first quarter, when it expects to book a one-time severance charge of US$160 million to US$185 million.

The company, which had 61,100 employees as of Sept. 30, said it was also considering closing facilities.

Halliburton, said it took a $129 million restructuring charge in the fourth quarter ended Dec. 31 to “temper the impact of anticipated activity declines”.

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CG

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