Subsea 7 S.A. has revealed that it expects to slash around 3,000 people from its global workforce of 12,000 by the end of the second quarter of next year.
The company anticipates that two-thirds of the reduction would affect its non-permanent workforce and one-third would impact permanent employees. Subsea 7 said discussions with employee representatives will take place on a local basis and added that consultation will start soon.
The company also outlined that its active fleet of 32 vessels will be reduced by up to 10 vessels through the non-renewal of chartered tonnage and the stacking of owned assets. Subsea 7 noted that it is intended that the reshaping of the fleet would take place over the next 12 months.
These cost reduction measures are expected to deliver approximately $400 million in annualized cash cost savings from the second quarter of 2021.
“Faced with a significant deterioration in the oil and gas market, we are taking swift and decisive action to address the elements under our control,” Subsea 7 Chief Executive Officer John Evans said in a company statement.
“These measures to reduce our cost base will help preserve cash and protect our balance sheet strength, while maintaining our strong competitive position in core markets,” he added.
Last month, Subsea 7 revealed in its first quarter results that “swift and decisive” action had been initiated to resize the business. The company posted a net operating loss of $49 million in 1Q, compared to a net loss of $10 million during the same period last year.
Subsea 7 describes itself as a global leader in the delivery of offshore projects and services for the evolving energy industry. The company, which has offices all around the world, has completed over 1,000 projects, according to its website.
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