Halliburton layoffs expected to affect hundreds in Canada

5,200 worldwide

CALGARY • Hundreds of Canadian oilfield workers are expected to be caught in a new round of job cuts confirmed Tuesday by giant Houstonbased Halliburton Co. in reaction to plunging levels of drilling activity in Canada and the U.S. driven by falling oil and gas prices.

The cuts, along with 7,000 announced last month by Baker Hughes Inc., 9,000 by Schlumberger Ltd. and 8,000 by Weatherford International PLC, likely represent the tip of the iceberg for the Canadian oilfield industry.

In January, the Canadian Association of Oilwell Drilling Contractors issued a report predicting an average of 167 fewer drilling rigs will be active this year in Canada, resulting in 23,000 fewer direct and indirect jobs than in 2014. That’s about 3,000 more lost jobs than in the last oil price downturn in 2008-09.

Halliburton spokesman Chevalier Mayes said in an email that layoffs are expected to result in the reduction of 6.5% to 8% of its global headcount. The company employs an estimated 80,000 people, which translates into 5,200 to 6,400 employees. The numbers include 1,000 layoffs in the eastern hemisphere that Halliburton announced in December. Halliburton Canada employs about 1,800 people, a company official said.

“We value every employee we have, but unfortunately we are faced with the difficult reality that reductions are necessary to work through this challenging market environment,” said Mr. Mayes, who declined to say what the Canadian numbers will be.

“The impact will be across all areas of Halliburton’s oper- ations. We do not have additional information on specific regions.”

The oilfield services industry, which helps explorers find and produce oil and natural gas, has been deeply affected as oil firms slash spending. Crude prices have plunged more than 50% since June as U.S. production surged and the Organization of Petroleum Exporting Countries resisted output cuts.

Local financial analysts who asked not to be identified because they don’t cover Halliburton estimated that Canada accounts for 3% to 5% of the company’s operations, mainly in Alberta, so between 200 and 300 people will likely be laid off.

Previously, they estimated the Baker Hughes cuts could result in between 300 and 500 Canadian layoffs and Schlumberger’s in the range of 450 to 650 — the total is between 950 and 1,450.

Halliburton said in November it would acquire Baker Hughes for $34.6 billion. Mr. Mayes said the cuts had nothing to do with that acquisition.