Polarcus Limited has announced a $15 million cost reduction plan following the coronavirus outbreak and recent oil price crash.
Under the plan, personnel cost onshore and offshore will be reduced by around $6.5 million through a combination of redundancies and a reduction in base salary for six months. The salary reduction is effective from today and comprises a 25 percent cut at senior level and a 15 percent drop for the rest of the company’s team.
General and administrative costs will also be reduced by approximately $1.5 million and cash capital expenditure will be cut by around $7 million. Polarcus Limited revealed that further cash savings are expected to be realized through warm stacking vessels in-between projects.
All of Polarcus Limited’s onshore team is currently working from home. Offshore, the company said it has implemented a “robust” regime of health screening for all field crew. Polarcus Limited also noted that it has performed a detailed covid-19 pandemic risk assessment and that it has prepared a response plan that is customized for each project.
“The combination of these business continuity and cost reduction initiatives provides a robust framework for Polarcus to navigate the current uncertainty and to position the company to capture an increased level of activity going in to 2021,” Polarcus Limited said in a company statement.
Polarcus Limited describes itself as the industry leader in marine seismic exploration. The company, which is headed by Duncan Eley, has offices in Dubai, Houston, London, Singapore and Oslo, according to its website.
Last month, Polarcus Limited revealed that a project in the Asia Pacific region and a project in West Africa had been terminated by its clients. The names of the clients were not revealed and no reasons were given for the termination of the contracts.
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