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Cenovus Energy to slash 440 more jobs as oil price fallout continues

Click to play video: 'More layoffs at Cenovus Energy' More layoffs at Cenovus Energy
WATCH ABOVE: One of Canada’s biggest oil companies is cutting its payroll again. With more on the job losses here’s Gary Bobrovitz – Mar 31, 2016

CALGARY – Hundreds of people will lose their jobs at Cenovus Energy in another round of layoffs prompted by soft oil prices, Global News has learned.

“Sadly, we will be losing about another 440 people which was a very difficult but necessary decision given the current economic environment,” Brett Harris, a spokesperson for Cenovus Energy, said. “About 190 of those people – mostly contractors – have already left as the work they were doing eventually went away. Another 250 people will be leaving soon, mostly in April.”

The Calgary-based company said it is trying to cuts costs in 2016 and reducing payroll is a partial solution.

These new layoffs come after Cenovus laid off about 1,300 people in 2015.

The company has now lost about 31 per cent of its staff since oil prices began dropping from over $100 USD a barrel to the current price which is now hovering in the high thirties.

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Some economists say the layoffs are signal that there’s still more pain ahead for people working in the oil patch.

“It looks to me like the oil sector is settling down for the long term of relatively low oil prices and so they are getting ready to hunker down, lay people off and look long term at $40 USD or $50 USD oil,” Prof. Ron Kneebone at the University of Calgary’s School of Public Policy said.

Oil prices have rebounded over the past few months but Kneebone said it’s not sustainable and oil companies must still reduce their operational costs in a tough economic environment.

However,there are a few bright spots in the oil patch job market.

According to Statistics Canada, Canada’s long-suffering oil sector jumped two per cent as oil and gas extraction increased 1.4 per cent in its fourth straight gain in January.

For oil service companies, it means keeping some jobs.

“They are working – and in some case even hiring – because they are busy, you know, well testing and doing what they can to help optimize that production,” Mark Salkeld, president of the Petroleum Services Association of Canada, said.

The Petroleum Services Association of Canada still admits it’s been a tough 2015 and 2016 doesn’t look much better.

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