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Jobs at risk in UK oil industry as Schlumberger prepares cuts

Times Online
The Times
January 10, 2009

Hundreds of jobs in Britain’s North Sea oil industry are under threat after Schlumberger, the world’s largest oil services company, announced plans to cut its global workforce.

The company, which employs 4,000 people in the UK out of a global workforce of 84,000, confirmed late on Thursday that it was cutting 5 per cent of its US workforce, or 1,000 jobs, and was seeking further cuts elsewhere. Just over 2,000 of Schlumberger’s UK staff are based in Aberdeen, the centre of Britain’s oil industry. The remainder are employed at offices at Gatwick and in London, Reading, Abingdon, Southampton, Cambridge and Belfast.

A spokeswoman at the company’s UK headquarters at Gatwick said: “In the current economic climate, we are looking at the most effective ways of managing our resources in the UK and across operations globally.”

She acknowledged that job cuts were a possibility, but declined to comment on how many there would be. If applied internationally, the US headcount reduction of 5 per cent would represent a loss of 200 positions.

Stephen Whittaker, European director of communications for Schlumberger in Paris, also declined to comment on specifics, but sounded a gloomy note. “At the moment, we are trying to match resources with demand,” he said. “We are seeing less demand, so we will also be seeing fewer resources.”

The American group, which is based in Houston and whose customers include all the leading oil groups, such as BP and Shell, as well as national oil companies, operates in more than 80 countries and performs everything from specialist exploration to the drilling of wells and management of existing fields.

Although the North Sea oil business has so far escaped the worst of the job culls that have plagued much of the UK industrial sector in recent months, there are mounting fears that further cuts could be on the way as plunging oil prices, which have fallen from record highs of $147 a barrel last July to $41 yesterday, undermine investment.

Halliburton, another US oil services group, also said this week that it is to start shedding workers, but did not say where or when. Halliburton employs 55,000 people globally, including many in the UK, where its headquarters are also in Aberdeen.

About 450,000 people are employed in Britain’s oil industry, of whom 350,000 are directly dependent on the North Sea, according to Oil & Gas UK, the industry’s trade association.

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