Trinidad Drilling: Jobs cut
Trinidad Drilling cuts 500 jobs
Canada's Trinidad Drilling has cut more than 500 jobs and is looking at moving more rigs into international markets as it tries to deal with a severe slump in North American oil and gas drilling.
Company boss Lyle Whitmarsh said the company has let go about 15% of the 3500 Canadian and American staff it employed a year ago and is trying to cut a minimum of 10% of overall costs through wage reductions and measures including the delay of recertifying idled rigs.
He said one previously ordered rig to be delivered in the second quarter will not be assembled but the company will take delivery of the parts to be used to repair and maintain existing rigs.
"The first quarter of 2009 has shown the impacts of the global economic crisis and lower commodity prices. We are very aware that the next six to 12 months will continue to presents us with many challenges and obstacles," said Whitmarsh.
Trinidad, which will have a total of 119 rigs after four more are added to the US fleet this year, posted a first-quarter net loss of $5.6-million, or six cents a share, mainly due to an intangible asset charge of $23.2-million recorded in relation to its Gulf of Mexico barge drilling operations, said a Canwest News Service report.
Net earnings before the non-cash writedown were $17.5-million, or 19 cents per share, down 55% from the year earlier period.
Revenue for the first quarter of the year was $192-million, down 13%, as utilisation levels fell in both Canada and the US.
Trinidad's first quarter drilling utilisation rate was 51% in Canada, down 29% from the previous year but higher than the industry average of 36%.
Activity levels in the US and Mexico drilling operations were 64% compared to 87% in the first quarter of last year.
Cash flow from operations before changes in non-cash working capital was $52-million (55 cents per share diluted) in the first quarter of the year, down 27%.
Trinidad moved three rigs to Mexico from Canada late last year to work on six-month contracts and Whitmarsh said more rigs may follow.
Last week, the Petroleum Services Association of Canada said a survey of member companies showed an estimated 12,000 to 15,000 Canadian workers had been laid off since last fall.
It lowered its drilling forecast for the third time to just 10,000 wells this year, the lowest since 1998.