Penn West cuts capex to $500 million

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.”

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