NOI Natl Oilwell

   By Kjetil Malkenes Hovland 
 

OSLO--National Oilwell Varco Inc.'s (NOV) Norwegian arm said Monday it is shedding 900 jobs, bringing total cuts this year to 2,400, or roughly half its worforce, as redundancies in the industry bite deeper.

The company said employees had been informed by email that 900 permanent jobs would be cut, and that manufacturing operations in southern and western Norway would be shut down. This comes on top of announced cuts in June of 900 permanent jobs and 600 contract workers, out of a total staff of nearly 5,000.

"The management of National Oilwell Varco Norway understands that this creates uncertainty among our many employees," the company said. "We will continue to focus on the importance of carrying out an orderly process that takes care of all employees in the best possible way."

The drilling equipment maker blamed the downsizing on reduced spending by oil companies and lower sales of new equipment.

Oil companies operating in Norway expect their investments in exploration and production to drop to 171 billion kroner ($19.83 billion) next year, from a record-high NOK214 billion in 2014, according to Statistics Norway.

Industry association Norwegian Oil and Gas expects investments to bottom out at NOK132 billion in 2017.

Statoil, Norway's dominant oil company, said earlier this summer that it would shed up to 1,500 permanent positions and 525 consultants from a total Norwegian workforce of 20,709, as part of a program targeting $1.7 billion in annual cost savings by 2016.

The string of job cuts by major employers in the Norwegian oil sector highlights how a drop in oil prices since last summer, from well above $100 per barrel to less than half that level, is forcing oil companies and oil-field services businesses to tighten their belts following years of rapid expansion and cost inflation.

Oil traded Monday at around $43 per barrel.

The Houston-based National Oilwell Varco had 63,642 employees globally by the end of 2014 and its Norwegian arm contributed about 4% of the company's $21.44 billion in total revenue last year.

Write to Kjetil Malkenes Hovland at kjetilmalkenes.hovland@wsj.com

(END) Dow Jones Newswires

December 07, 2015 05:55 ET (10:55 GMT)

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