Vancouver Sun

Downturn takes toll on jobs

- DAVID WETHE

Schlumberg­er Ltd. cut more jobs in the first quarter as the world’s largest provider of oilfield services sees the industry in an unpreceden­ted downturn.

The global head count dropped to 93,000 at the end of the first quarter with the reduction, Joao Felix, a spokesman for the company, said by email. The company let go about 8,000 people in the quarter, and reclassifi­ed about 5,500 contractor­s as permanent workers, chairman and CEO Paal Kibsgaard said Friday in a conference call with analysts and investors. One-third of Schlumberg­er’s workforce, or roughly 42,000, has now been cleaved off since the worst crude-market crash in a generation began in mid-2014.

“The decline in global activity and the rate of activity disruption reached unpreceden­ted levels as the industry displayed clear signs of operating in a full-scale cash crisis,” Kibsgaard said in a statement announcing first-quarter earnings Thursday.

“This environmen­t is expected to continue deteriorat­ing over the coming quarter given the magnitude and erratic nature of the disruption­s in activity.”

Oilfield service providers were the first to feel the pain when crude prices began falling in the middle of 2014. Of the more than 250,000 jobs cut globally in the energy industry during the downturn, service providers continue to be the most heavily impacted after customers slashed more than US$100 billion in spending last year, with promises of more cuts to come.

Schlumberg­er’s profit fell in the first quarter as the company, which helps explorers find pockets of oil undergroun­d and drill for it, adjusts to shrinking margins in North America as customers scale back work.

Net income declined to US$501 million from US$975 million a year earlier, the Houston- and Paris-based company said.

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