Penn West cuts capex to $500 million
CALGARY, September 1, 2015 – Canadian oil and natural gas production company Penn West has been forced to lower its capital expenditure to $500 million in response to low crude prices, the company’s CEO said in a Tuesday press conference. Penn West is expected lay off 35 percent of its workforce, or about 400 jobs.
The job cuts will save the Alberta-based corporation a projected $45 million a year. Most of the jobs will be cut from its Calgary offices. A further $20 million will be saved by suspending dividend payments to non-management directors.
Alberta’s energy industry in particular has been hit hard by this year’s drop in crude prices. For the year, Penn West had expected capital expenditure of $840 million. Now, the company has limited itself $500 million, a 40.5-percent drop off, and a 13-percent drop from July’s tightened budget.
“We have made a number of exceptionally difficult decisions in order to remain competitive in the current commodity price environment,” Penn West CEO Dave Roberts said at a Tuesday press briefing. “We view the cost reductions as sustainable, and we will remain well positioned for the potential expansion of development activities and capital programs in the future.”
For more news and features on Canada, click here.
Trinidad’s energy opportunitiesINTERVIEW
Latest news and features
Nigeria as a major maritime hubINTERVIEW
Steps to improve the maritime sectorINTERVIEW