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AFX News Limited: Shell seeks 100 mln usd cost cuts in Nigeria – report

06.15.07, 2:24 AM ET
LONDON (Thomson Financial) – Royal Dutch Shell PLC is looking to cut at least 100 mln usd in spending from its Nigerian operations in the next few years to offset rising costs and lost revenue as security concerns curtail oil production, the Wall Street Journal reported, citing people familiar with Shell’s operations

The planned cuts are likely to include trimming at least 200 jobs in the next three years, said the people familiar with the matter. In an internal announcement to Shell’s 4,500 Nigerian employees May 30, the company said the changes amount to ‘an austerity program for three years,’ according to the newspaper.

‘The measures will demand significant step change in performance at personal and organizational levels as well as focus on how to reduce costs,’ Shell said in the announcement.

The move appears to be a sign that Shell, Nigeria’s biggest foreign oil producer, is positioning itself for a period of continuing strife and production problems in the country, the Journal said.

A Shell spokesman said it was ‘too early to report any details’ of the company’s cost-cutting program.

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