Workers will be cut and shuffled as Cenovus Energy reacts to dropping oil prices. Yesterday, the company announced a revised 2015 capital budget of between $1.8 to $2 billion dollars.
“In the coming weeks, Cenovus intends to realign its workforce based on its revised spending plans. Where work has been stopped or deferred, the company plans to reassign employees to core business areas and intends to begin reducing the size of its contract workforce,” the company states in a news release.
The revised budget shows a $700 million difference from its original plans. Cenovus is also suspending most of its conventional drilling program in southern Alberta and Saskatchewan, but the Christina Lake and Foster Creek projects will continue.
“I believe crude oil prices will rebound, but the timing is uncertain. We’re taking the actions we deem prudent to help protect the financial resilience of Cenovus without compromising our future,” states President and CEO Brian Ferguson. “As a result of the dramatic slowdown across the energy sector, we expect to see continued reductions in demand for labour, service and materials. This should create potential opportunities for us to drive improvements in our cost structure.”
With the adjustments to spending, Cenovus expects total crude production for the year to sit between 195,000 to 212,000 barrels per day.