BP staff on Teesside have today been warned there will be hundreds of job cuts across the company’s North Sea operations.
The oil and gas multinational, which employs around 80 at its Seal Sands terminal, has told employees around 200 jobs and 100 contractor roles will go, as part of an on-going efficiency drive.
It has not been confirmed whether the Teesside operations will be directly affected, but chiefs said most of the at-risk jobs are office-based support roles.
Company chiefs were keen to point out the cuts were not a knee-jerk reaction to plummeting oil prices - but a combination of production decline, cost rises, ageing assets and investment opportunities that were ‘modest on a global scale’.
The company had warned of job losses last month, amid restructure plans.
Trevor Garlick, Regional President for BP North Sea said: “We needed to respond to toughening market conditions and also to the fact that we are now a smaller business than we were in 2010. “The recent oil price reduction has simply made this even more imperative.
“We are committed to the North Sea and see a long term future for our business here.
“However, given the well-documented challenges of operating in this maturing region and in toughening market conditions, we are taking specific steps to ensure our business remains competitive and robust, and we are aligning with the wider industry.
“Whilst our primary focus will be on improving efficiencies and on simplifying the way we work, an inevitable outcome of this will be an impact on headcount and we expect a reduction of around 200 onshore staff and 100 contractor roles.
“We have spoken to staff and will work with those affected over the coming months.”
But industry experts were optimistic about the future recovery of the North-east sector.
George Rafferty, Chief Executive of NOF Energy, said the region’s ‘innovative and flexible’ suppliers were ‘experienced at operating within a fluctuating industry’.
“They can deliver agile and innovative services, that can meet the future scale and requirements of the UKCS [UK Continental Shelf].
“Our members are keeping a watching brief on the current oil price; however they are very much focused on the long-term future of the offshore sector.
“The sector will recover.
“Working closely and smarter with operators and lead contractors, supply chain companies can help deliver a step change in the industry through increased collaboration and a fresh approach to doing things. This will ensure whether the industry needs to better control costs or react to changes to the oil price the industry can become more resilient and effective.”
The price per barrel of oil has fallen recently from a high of $115 to less than $48.
The volatility of the sector has had a knock-on effect elsewhere, with Darlington-based subsea engineering specialists DeepOcean announcing job cuts this week. Oil field services firm Archer’s has closed its Blyth base and subsea firm Flexlife has confirmed it’s reviewing its Gateshead operations.
BP employs around 15,000 people in the UK and 84,000 worldwide.
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