ConocoPhillips said Tuesday it will cut up to 10 percent of its worldwide workforce, with many of the cuts coming from the company's North American operations, including in Alaska.
ConocoPhillips Alaska spokeswoman Natalie Lowman said she did not know the exact number of jobs to be cut in the state, but did say that they would be "in that 10-percent range."
The loss of up to 1,800 employees company-wide comes at a time of low world oil prices and cost-cutting at ConocoPhillips.
ConocoPhillips employs about 1,200 people in Alaska and has assets throughout the state, including large portions of the Prudhoe Bay oil fields. Darren Beaudo, a spokesman in the company's Houston office, said employees received an internal memo about the cuts on Monday. He said most of the affected employees would receive formal layoff notices next month.
"We'll know more in the next several weeks as we work through our formal process," Lowman told Alaska Dispatch News. "Our industry is undergoing a dramatic downturn, which has caused us to look at our future workforce needs."
Oil prices have plunged because of a supply glut that built up as production increased and growth in the global economy slowed. The health of China's economy, the second-largest in the world, is a dominant concern. In response to falling oil prices, almost all energy companies have either cut spending on exploration or cut jobs, often both, and many have seen big drops in their stock prices. Oil and gas and drilling services companies have said they'll cut tens of thousands of positions. The biggest oil field service company, Schlumberger, is eliminating 20,000 jobs.
In addition to its Alaska assets, ConocoPhillips is a major player in Alberta oil sands, where at least 400 of the layoffs will take place, the company said. Five hundred people are also expected to lose their jobs at the company's Houston headquarters.
ConocoPhillips, which posted a second-quarter loss of $179 million, had already cut more than 1,000 jobs in 2015 and has pared its spending forecasts. It said it was preparing for a period of lower and more volatile prices. The company said Tuesday it is reducing deep-water exploration work, but job cuts were also needed to make it stronger and more competitive.
ConocoPhillips stock declined $1.40, or 2.9 percent, to close at $47.75 Tuesday as the markets slumped. The company's shares have fallen 41 percent over the last year and fell to their lowest prices in almost five years in August.
U.S. oil is trading at six-year lows. After a big three-day rebound, the price of U.S. oil fell 8 percent on Tuesday to close at $45.41 on weak manufacturing data from China.
The Associated Press contributed to this report.
Alaska Dispatch Publishing