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Oil giant Shell to axe 330 UK jobs due to covid restrictions – with thousands more to follow

Oil giant Shell to axe 330 UK jobs due to covid restrictions – with thousands more to follow

The move forms part of 9,000 jobs set to be axed across the business over the next two years following a collapse in demand for oil due to the ongoing coronavirus pandemic

BY Emma Munbodh: Deputy Money Editor
  • 13:31, 12 JAN 2021
  • UPDATED14:45, 12 JAN 2021

As well as cutting costs, Shell says it wants to be a net-zero emissions energy company by 2050

Shell is preparing to cut 330 UK jobs over the next two years as coronavirus continues to hit profits.

The oil giant said it plans to shed a quarter of its workforce in Aberdeen by December 2022.

Around 330 jobs are to go from a total of 1,330 UK roles over the next two years.

It cited the switch to low-carbon electricity and the coronavirus pandemic for its decision.

The move forms part of wider plans to cut 9,000 jobs worldwide over the next two years, following a collapse in demand for oil amid global lockdowns.

Royal Dutch Shell said the cuts would be implemented by 2022 – it told The Mirror a further 1,500 employees are expected to take voluntary redundancy.

The move comes after Shell cut its dividend last year for the first time since World War Two.

Shell, which employs 83,000 people worldwide, has been hit by a substantial drop in demand and profits since February this year.

It saw a 46% fall in first-quarter net income to £2.3billion, while second-quarter income fell 82%, as the industry continued to be hammered by lockdown.

The company has already announced a wider cost-cutting drive to deliver annual savings of $2billionn by 2022.

“We have had to act quickly and decisively and make some very tough financial decisions to ensure we remained resilient, including cutting the dividend,” said chief executive Ben van Beurden.

“But as hard as they were, they were entirely the appropriate choices to make. And Covid-19 has hit us in another way. We have, very sadly, lost six employees and six contractor colleagues to the virus.”

Van Beurden said Shell plans to become a net-zero emissions energy business within 30 years.

“We will have some oil and gas in the mix of energy we sell by 2050, but it will be predominantly low-carbon electricity, low-carbon biofuels, it will be hydrogen and it will be all sorts of other solutions too,” he said.

Rival BP also recently announced plans to slash 10,000 jobs worldwide.

It said the employees are expected to leave the company by December 31.

In an email to 70,000 workers in June, BP chief executive Bernard Looney said: “We will now begin a process that will see close to 10,000 people leaving BP – most by the end of this year.

“The majority of people affected will be in office-based jobs.

“We are protecting the front line of the company and, as always, prioritising safe and reliable operations.”

BP said the cuts – which equate to 15% of its global workforce – follow a significant drop in demand as a result of the coronavirus pandemic.

The company has also now signed a $5billion deal to sell its global petrochemicals business to oil giant INEOS.

It said the sale will be “the next strategic step in reinventing BP”.

INEOS already operates across 180 sites in 26 countries, employing some 22,000 staff worldwide.

It is understood that around 1,700 BP employees will transfer to INEOS on completion of the sale.

SOURCE

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