Enbridge slashes workforce by 1,000
Cuts come on heels of Spectra megadeal
The cuts have come swiftly at energy giant Enbridge Inc., which is laying off about 1,000 staff less than a month after closing its blockbuster takeover of Houstonbased Spectra Energy Corp.
Calgary-based Enbridge says the layoffs, amounting to about six per cent of the 17,000 employees of the combined company, stem from the merger that closed Feb. 27.
“After a careful evaluation, Enbridge has taken the difficult but necessary step to address the overlap in the combined company’s organizational structure,” said spokesman Todd Nogier in a statement.
He did not provide details about where the cuts are happening, but says they’re being done across the merged company.
Nogier also confirmed that the company will be moving out of the Enbridge offices in downtown Houston and consolidating operations in the state at Spectra’s offices there by the end of the year.
Under the terms of the merger, Calgary became the headquarters of the combined company, while the Houston office became the company’s gas pipelines business unit centre.
When the $37-billion, all-stock takeover was announced last September, the companies said they expected to achieve $540 million in annual cost savings from synergies.
At the time, Enbridge CEO Al Monaco said they would move forward quickly to cut costs, expecting about 60 per cent of those savings to happen this year and another 30 per cent in 2018.
The latest job cuts come after Enbridge eliminated about 530 positions last October in Canada and the U.S. after an organizational review it said was started well before the Spectra deal was announced.
Jim Fearon, vice-president at recruitment firm Hays Canada, says the job cuts should be seen as tied to the merger, rather than an indicator of the overall economy.
Fearon said that overall, there are positive signs of hiring in the oil and gas industry, though companies are still being cautious about committing to long-term staff increases.