Neptune Energy to axe 400 jobs over Covid-19 and lower oil prices

Oil and gas company Neptune Energy has decided to reshape the size of its global organisation due to the combined impact of the Covid-19 pandemic and the anticipation of lower commodity prices for a longer period of time.

A spokesperson for Neptune told Offshore Energy that about 400 roles across nine countries will be affected by this decision.

Half of these will be staff positions and the other half contractor positions.

The spokesperson noted that the impacted roles would be office-based and operations would not be impacted by these proposals.

“The decision to make these proposals was not made lightly and follows the deferral of project and exploration activities to reduce costs this year as we announced at our full-year results in March.

“The challenges facing the global oil and gas industry are clear and we know we must take further steps in order to emerge stronger and in a position to continue making a positive contribution to society’s energy needs”, Neptune Energy said in the statement for the media.

The company also noted that the changes made now reflect the structure required in the future.

In a letter to Neptune’s employees, Neptune CEO Jim House said: “The combined impact of the pandemic and the sudden and sharp fall in commodity prices means we must look at our business differently and ensure we are not just fit for now, but suited for a different outlook going forward.

“Our activity set has moderated and, regrettably, this means we must also reshape the size of our organisation accordingly”.

House also added: “Like all energy companies, Neptune has been impacted, with revenues this year – and probably next year – expected to be correspondingly down compared with where they were last year. In response, we have successfully increased our lending facility, reduced our expenditure across the business by some 30% this year and our shareholders have agreed not to receive a dividend in 2020.

“As far as these measures have taken us, it is clear we must take further steps as we face a future that is very likely to experience lower commodity prices for a longer period of time. It is unclear when energy demand will fully recover and at what levels commodity prices will be when it does.

“While much is uncertain, we know we must act now to ensure Neptune emerges stronger and continues to safely make a valuable contribution to the societies and the communities where we work”.