Short and to the point—-Newfield Exploration’s announcement this week that 50 of its employees in Oklahoma would be laid off and nearly 150 others would be transferred from the Tulsa offices back to the firm’s headquarters in Houston, Texas.
Blame the oil and gas downturn and Newfield’s loss of millions in the first quarter of the year. Six days after Newfield reported a net loss of $624 million or $3.52 per diluted shared, the firm announced the shut-down of its Tulsa offices, explaining it planned “to consolidate its operating functions to its headquarters in The Woodlands, Texas which will result in a significant reduction of employees located in its Tulsa, Oklahoma office.”
The official statement on file with the Securities Exchange Commission said the consolidation is expected to improve business and cost efficiencies in operations and margins in today’s “continuing low commodity price environment.”
An estimated 150 workers will be offered relocation packages for the move to Houston. The consolidation is expected to be finished by the end of the third quarter of the year.
“The Company currently estimates that one-time charges association with the consolidation and reorganization will be approximately $30 to $36 million consisting primarily of severance payments of approximately $18 to $23 million,” stated the company.
Despite the $624 million dollar first-quarter loss, Newfield also is wrapping up its $470 million of 42,000 net acres of leased land from Chesapeake Energy in northwestern Oklahoma. The asset has current production of 3,800 barrels of oil equivalent per day. It also holds an estimated 1,000 potential drilling locations.
The deal is expected to be completed in the second quarter of the year.
