Shell to axe North Sea jobs

Axed: Shell cutting North Sea jobs

Shell will axe 250 North Sea upstream jobs after reviewing its business in the region, where high costs are hindering the field developments and operations of a number of companies.

A Shell spokesperson confirmed to Upstream on Thursday that both employee and contractor positions will be cut. All jobs affected are based onshore.

Shell is re-organising its upstream onshore operations "to better serve the needs of its offshore facilities and to build a stronger long-term business in the North Sea", the spokesperson said.

"Following staff consultation, Shell expects to reduce employee and contractor head count by a total of around 250 positions over the next year. Revisions to the onshore organisation will be implemented by the end of 2014.

"Shell is determined to ensure that it continues to deliver safe, competitive operations in its North Sea portfolio and maximises value from its operated assets."

Shell follows US supermajor Chevron, which said last month it was shedding 225 North Sea positions. Drilling contractor Odfjell has also said it is cutting jobs.

Upstream revealed in June that potentially hundreds of jobs were at risk after Shell launched a review of the operating model for work carried out from its Aberdeen-based headquarters.

Shell's Aberdeen-based staff provide services not just for the North Sea but also for Shell's global projects and support roles, such as human resources and finance.

 

In 2013, Shell's upstream business employed about 4500 people in Scotland, including onshore and offshore, company staff and core contractors. It also employs 1000 people through various service contracts.

On 11 February, staff were told Shell had begun marketing its ageing Anasuria, Nelson and Sean assets.

Shell is currently investing about $2 billion a year in its UK assets.

These are grouped into three main areas — southern North Sea gas, non-operated stakes in big upcoming projects in the west of Shetland, such as the BP-operated Quad 204 and Clair Ridge schemes, and more mature fields in the central and northern North Sea, which include the Brent, Shearwater, Gannet and Curlew areas.

Chief financial officer Simon Henry said previously the mature assets have been absorbing $1 billion of the $2 billion spending for "very limited growth potential".

Over the last four years, Shell's total average production from the UK North Sea has been about 136,500 barrels of oil equivalent per day, though it fell by 22% in 2013 to 91,000 boepd.

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