Oil companies Shell and Taqa have both announced plans to cut about jobs due to the “challenging” economic conditiions facing the North Sea industry.
Shell has announced that it is axing around 250 jobs – this is in addition to the job cuts announced by the oil giant last August.
Taqa has plans to cut up to 100 jobs and is consulting with its workforce on the move, which would affect mostly contractors and consultants working in onshore positions.
Paul Goodfellow, Shell Upstream Vice President, UK and Ireland, said: “The North Sea has been a challenging operating environment for some time.
“Reforms to the fiscal regime announced in the budget are a step in the right direction, but the industry must redouble its efforts to tackle costs and improve profitability if the North Sea is to continue to attract investment.
“Current market conditions make it even more important that we ensure our business is competitive.
“Changes are vital if it is to be sustainable. They will be implemented without compromising our commitment to the safety of our people and the integrity of our assets.”
A Taqa spokesperson said: “Taqa’s UK North Sea business, along with the industry as a whole, is operating in a challenging environment.
“As part of our focus to ensure Taqa’s sustainable future in the UK, regrettably it is necessary for us to scale back the number of people working with us.
“The impact of these changes will predominately be on contractors and consultants.
“We are currently proposing a reduction of around 100 onshore positions, but the process will take a number of weeks and involve consultation with our workforce.
“Our workforce are fully informed on the proposed changes and we will work to support and guide them through the process.”
This is just the latest in a series of job cuts by North Sea operators, including the likes of BP and Chevron.
Mike Tholen, Economics Director, Oil & Gas UK, said: “While these are tough decisions to take given the impact on people, the measures are being taken by many companies and will allow the UK to benefit in the long-term from a boost to energy security, hundreds of thousands of highly skilled jobs and billions of pounds worth of supply chain exports.”
According to Oil and Gas UK, around 20% of UK production is uneconomic at a $50-barrel crude oil price.