Maersk Drilling cuts up to 170 onshore jobs as low oil prices hit profitability

Maersk Drilling has lowered its guidance for 2020 due to the impact of Covid-19 and low oil prices, and will further reduce costs with the reduction in its onshore workforce.

The company has revised its profitability guidance for 2020 for an EBITDA, before special items, to $250m-$300m which is down from a previously lowered guidance of $325-$375m in March.

“Since then, oil and gas companies have announced further reductions in spending budgets and sanctioning of new projects and ongoing tenders have been postponed or cancelled. Further, certain existing contracts have been renegotiated, suspended or terminated,” the company said in a statement.

Having already reduced its offshore crew pool by 250-300 in April, Maersk Drilling now intends to reduce its onshore organisation through 150-170 redundancies globally.

Jorn Madsen, CEO of Maersk Drilling, commented: “With the outbreak of COVID-19 and the lower oil prices we are facing an unprecedented reality with significant implications for our business. Our ambition is to remain a leading company in our industry, and in order to safeguard that position we need to adapt our cost structure to the current business environment. This means that we need to take steps to reduce the workforce, which is unfortunate, not least in the light of the great efforts by our competent and dedicated employees, also over the past critical months.”

Earlier this week, Maersk Supply Service announced it would reduce its onshore work force by around 55 people.

Grant Rowles

Grant spent nine years at Informa Group based in London, Sydney, Hong Kong and Singapore. He gained strong management experience in publishing, conferences and awards schemes in the shipping and legal areas, working on a number of titles including Lloyd's List. In 2009 Grant joined Seatrade responsible for the commercial development of Seatrade’s Asia products. In 2012, with Sam Chambers, he co-founded Asia Shipping Media.
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