Apache, 2 other Houston oil companies cut nearly 600 jobs by Jordan Blum, Jan. 9, 2020, Houston Chronicle
Three Houston oil and gas companies Thursday said they would slash nearly 600 jobs in Texas, a day after Occidental Petroleum began a massive staff reduction.
Oil and gas producer Apache Corp. announced the largest of the cutbacks, saying it would eliminate more than 270 positions as it closes its regional San Antonio office.
Meanwhile, oil field services company Enterprise Offshore Drilling said it would lay off around 60 workers, part of a planned release of a Gulf of Mexico oil rig.
A third company, Valerus Field Solutions, said it’s closing an oil and gas equipment plant in Sealy, west of Houston, in March and eliminating about 250 jobs. Valerus is a division of SNC-Lavalin Group, the Montreal-based company that bought it in 2014.
Modest oil prices and spending cuts have contributed to the loss of nearly 5,000 oil and gas jobs in Texas from June through November, according to the Texas Workforce Commission. Thursday’s announcements followed news that Occidental began cutting workers in the wake of its August acquisition of The Woodlands-based Anadarko Petroleum.
Houston-based Apache said it is reducing its global workforce by up to 15 percent — about 500 jobs — as part of a broader restructuring announced late last year. The job cuts include those eliminated through attrition, but some of the San Antonio jobs will be moved to Houston or other offices, an Apache spokesman said.
The San Antonio closing and the 272 job cuts will be finalized in early March, according to a letter the company filed with the Texas Workforce Commission.
“Apache has already centralized key activities and seen positive results and is looking to take further steps in that direction,” said company spokesman Phil West. “Staff reductions are always difficult, and we are working to support those employees who will be affected.”
Apache had a difficult 2019, reporting a larger-than-expected $170 million loss in the third quarter. Its stock price plunged more than 50 percent from late 2018 through a recent December low. The stock rebounded this week with the company’s discovery of oil off the coast of Suriname in South America. The stock fell nearly $1 early Thursday before rebounding to close down just 13 cents at $32.60 per share.
The company expects to save $150 million per year in its reorganization. In addition, Apache aims to slash capital spending this year by up to 20 percent — a cutback of $250 million to $500 million.
While Apache has a notable presence in South Texas’ Eagle Ford shale closer to San Antonio, it has increasingly turned to West Texas’ booming Permian Basin for production. Apache could manage its Eagle Ford operations from Houston or even its West Texas hub.
While Apache’s layoffs are aimed at cutting costs, the positions being cut by Enterprise followed an expected shutdown of a Gulf rig owned by EnVen Energy.
In a letter filed with the Texas Workforce Commission, Enterprise said it would layoff 61 workers aboard the rig, which is about 100 miles offshore. EnVen plans to cease operations at the end of January, Amy Warner, Enterprise’s vice president of human resources, wrote in her letter to the state.
The layoffs began in November and are expected to be completed by the end of February.
In a statement, EnVen said the rig release was planned and followed the completion of a nearly two-and-a-half-year drilling program.
Privately held Enterprise launched in January 2017 and is headquartered in Houston’s Energy Corridor. It provides crews for offshore drilling rigs and employs more than 500 workers.