Taqa North reduces staff to streamline operations
50 laid off as gas prices stay depressed
Taqa North Ltd., the Calgary-headquartered oil and gas company owned by Abu Dhabi National Energy Co. or Taqa, is laying off 50 employees.
The layoffs confirmed Monday represent about five per cent of its 950 staff in Canada and the United States and are part of a reorganization to streamline operations.
Employees were given their notices last Thursday.
President Ed LaFehr said the reorganization is not directly related to poor natural gas prices but i t will help reduce costs and increase efficiency.
“In a tight gas market, you really, really need to be top quartile, top decile in your ability to operate and your
… reason for the reorganization is to improve performance. ED LAFEHR, TAQA NORTH
PRESIDENT
ability to execute your capital and drilling plans and we weren’t there,” he said.
“The main reason for the reorganization is to improve performance and ensure our sustainability for years to come.
“We’re still investing a great deal of money and we’re going to invest a lot more.”
He said the company has operated its assets through three geographical divisions since buying three Canadian oil and gas companies for $7.5 billion to enter Canada about four years ago.
That is being changed to a “functional” single stream model used by most of Taqa’s Canadian rivals, he said.
About 40 positions were eliminated at head office. The other 10 layoffs are in the field.
Last week, Talisman Energy Inc. said it will soon announce introducing layoffs and other measures to chop about 20 per cent from about $1.3 billion in annual gross general and administrative costs.
In November, Taqa chief executive Carl Sheldon announced a third-quarter loss and said it will cut 2013 capital expenditures in Canada and the United States to $500 million from the planned $750 million.
LaFehr, former senior vicepresident in charge of Canadian operations for Talisman Energy Inc., took over as president of Taqa North in October from Frederic Lesage, who was moved to Abu Dhabi, capital of the United Arab Emirates, in a newly created role as chief strategy officer.
Taqa said it warned staff in late 2012 that positions were likely to be lost. It said it is supporting laid off staff during the transition.
It reported average North American oil and gas production through nine months of 2012 of 84,500 barrels of oil equivalent per day, down four per cent from 87,600 boe/d the year before, as it disposed of non-core assets and shut in uneconomic gas production.
LaFehr said the purchase of Alberta assets for $162 million from Calgary-based NuVista Energy Ltd. last fall added about 5,000 boe/d of production, helping Taqa exit the year at about 91,000 boe/d.
He said the company will spend about 80 per cent of its 2013 capital budget on oil or liquids-rich gas plays as it attempts to increase its 30 per cent liquids production weighting.