Released May 06, 2020 | GALWAY, IRELAND
en
Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Maersk Drilling will make up to 300 workers redundant in its North Sea operations as the COVID-19 pandemic and plummeting oil prices impact its offshore drilling operations.
The company confirmed that it intends to stack a number of the company's North Sea rigs and make the necessary cuts to its workforce, with consultations now taking place with trade unions and employee representatives in Denmark, Norway and the U.K.
"Though it's standard practice in our industry to adjust our workforce to activity levels, it never feels right to say goodbye to good colleagues, especially when so many have walked the extra mile to keep operations running in these very difficult circumstances. However, it's our responsibility to safeguard our business, and we are now taking steps to maintain competitiveness in the challenging market environment," said Jørn Madsen, chief executive officer of Maersk Drilling.
The decision comes just weeks after Maersk received notice of early termination for two drilling contracts. BG International Ltd., a subsidiary of Shell (RDS-A), terminated the contract for the semi-submersible Maersk Developer with immediate effect. The original end of contract was expected to be in August. Aker BP terminated the contract for the jack-up rig Maersk Reacher, which was hired for accommodation services on the Valhall field, with effect from end-April 2020. The original end of the contract was expected to be in October.
In March, Tullow Oil terminated its contract for the Maersk Venturer drillship approximately 19 months early. The company stated: "Since February 2018, Maersk Venturer has worked for Tullow offshore Ghana with an expected end of contract in February 2022. The rig is now expected to end the contract in June 2020." Early termination will reduce its revenue $175 million over the approximately 19-month span.
In related news, Houston, Texas-based Diamond Offshore Drilling Inc., the rig contractor controlled by Loews Corporation has filed for Chapter 11 bankruptcy protection. The company listed $5.8 billion of assets and $2.6 billion of debt in a Chapter 11 petition filed in Houston. There are 2,500 jobs at risk. The company stated in its filing that conditions worsened "precipitously in recent months," citing a price war between OPEC and Russia and the COVID-19 pandemic.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Our European headquarters are located in Galway, Ireland. Follow IIR Europe on: Facebook - Twitter - LinkedIn For more information on our European coverage send inquiries to info@industrialinfo.eu or visit us online at Industrial Info Europe.
The company confirmed that it intends to stack a number of the company's North Sea rigs and make the necessary cuts to its workforce, with consultations now taking place with trade unions and employee representatives in Denmark, Norway and the U.K.
"Though it's standard practice in our industry to adjust our workforce to activity levels, it never feels right to say goodbye to good colleagues, especially when so many have walked the extra mile to keep operations running in these very difficult circumstances. However, it's our responsibility to safeguard our business, and we are now taking steps to maintain competitiveness in the challenging market environment," said Jørn Madsen, chief executive officer of Maersk Drilling.
The decision comes just weeks after Maersk received notice of early termination for two drilling contracts. BG International Ltd., a subsidiary of Shell (RDS-A), terminated the contract for the semi-submersible Maersk Developer with immediate effect. The original end of contract was expected to be in August. Aker BP terminated the contract for the jack-up rig Maersk Reacher, which was hired for accommodation services on the Valhall field, with effect from end-April 2020. The original end of the contract was expected to be in October.
In March, Tullow Oil terminated its contract for the Maersk Venturer drillship approximately 19 months early. The company stated: "Since February 2018, Maersk Venturer has worked for Tullow offshore Ghana with an expected end of contract in February 2022. The rig is now expected to end the contract in June 2020." Early termination will reduce its revenue $175 million over the approximately 19-month span.
In related news, Houston, Texas-based Diamond Offshore Drilling Inc., the rig contractor controlled by Loews Corporation has filed for Chapter 11 bankruptcy protection. The company listed $5.8 billion of assets and $2.6 billion of debt in a Chapter 11 petition filed in Houston. There are 2,500 jobs at risk. The company stated in its filing that conditions worsened "precipitously in recent months," citing a price war between OPEC and Russia and the COVID-19 pandemic.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Our European headquarters are located in Galway, Ireland. Follow IIR Europe on: Facebook - Twitter - LinkedIn For more information on our European coverage send inquiries to info@industrialinfo.eu or visit us online at Industrial Info Europe.
