U.S. oil and gas producer ConocoPhillips will cut 20-25% of its workforce amid a broader restructuring program, a company spokesperson said on Wednesday.
Shares of the company were down 4.7% to around $94.
Employees received an email this morning containing a video message from CEO Ryan Lance detailing the plans, four ConocoPhillips sources told Reuters. The company is set to hold a town hall meeting on Thursday morning at 9 a.m. Central Time, the sources said.
ConocoPhillips has approximately 13,000 employees globally, meaning between 2,600 and 3,250 employees will be affected. Most of the cuts will be made before the end of the year, ConocoPhillips spokesperson Dennis Nuss said in an emailed response to Reuters.
New structure and management will be public in mid-September, and the new organization will be implemented by 2026, two of the sources said.
Oil major Chevron also announced layoffs earlier this year, as did service company SLB.
In April, two sources told Reuters that Houston-based ConocoPhillips had hired management consulting firm Boston Consulting Group to advise on the restructuring and layoff program, referred to internally as “Competitive Edge.”
ConocoPhillips’ net income shrank in the second quarter to about $2 billion, the lowest since the quarter ended March 2021, when COVID-19 had ravaged demand. The company warned of uncertainty and volatility in the markets in May, adding that it was looking to boost capital efficiency and reduce costs across the entire organization.
(Reporting by Georgina McCartney, Arathy Somasekhar and Ernest Scheyder in Houston, Shariq Khan in New York; Editing by Nathan Crooks and David Gregorio)