Woodside Shake-up Cuts Jobs
Sydney Morning Herald
Tuesday March 1, 1994
North-West Shelf operator Woodside Offshore Petroleum Pty Ltd yesterday brought down the axe on 429 of its workers' jobs, fulfilling a threat flagged more than a month ago.
The company, which has been under pressure from weak international oil prices, said in January that it intended to slash around $70 million from its annual costs of $265 million, and retrench almost one-third of its 1,600 employees.
The cutbacks are unrelated to the technical problems in the construction of the Goodwyn platform, whose $280 million in rectification costs will mostly be covered by insurance.
Announcing the retrenchments in Perth, Woodside management said it had become urgent to change the company from a project developer to an operations-based company.
Executive general manager Mr Peter Brown said continuing low oil prices were forecast to reduce revenue by more than $400 million in 1994.
"At current oil prices the NW Shelf Gas Project does not produce an adequate return on the extremely large capital investment made by the joint venturers to date," Mr Brown said.
Of the 429 retrenched workers, 140 jobs would be shed from Woodside's Karratha operations, 1,500 kms north of Perth, and 289 jobs would be lost in Perth. A further 50 Karratha workers would be relocated to Perth.
The bulk of the retrenchments - 29 per cent of Woodside's workforce - are to take effect from June 30.
"The restructuring will reduce total operator expenditure by approximately$70 million per annum on a sustainable basis," Mr Brown said.
© 1994 Sydney Morning Herald