Chevron Corp will lay off about 25% of Noble Energy’s employees who joined the oil major after its $4.1 billion purchase of the smaller rival earlier this month, the company told Reuters on Tuesday.
A collapse in crude oil prices has forced most oil and gas producers to drastically cut costs by laying off thousands of employees and cutting down on drilling. For many companies, consolidation with larger players at low or no premiums is becoming the only option to survive.
Reuters reported the job cuts, which are on top of Chevron’s plan to reduce 10%-15% of its own workforce, come after the company promised to lower its operating expenses by $1 billion this year to cope with the downturn.
Chevron’s 10%-15% cuts would imply a reduction of between 4,500 and 6,750 jobs, while job cuts at Noble will reduce the total workforce by roughly another 570 positions.
Most of the cuts will take place this year, Chevron said in an email.
Chevron’s purchase of Noble boosted its investments in U.S. shale patches of Colorado and the Permian basin and gave the company a foothold in Israel through Noble’s flagship Leviathan project, the largest natural gas field in the eastern Mediterranean.