BP to brief staff about job cuts amid restructure of North East operations

Oil giant BT employs thousands across the UK, including the North East, and unions say job cuts could cause serious damage to our energy capacity

Andy Buchanan/PA Wire An oil rig in the North Sea
An oil rig in the North Sea

Plans for job cuts are expected to be outlined by oil giant BP amid a restructuring of its North East operations.

A staff briefing is being held at the firm’s North Sea headquarters in Aberdeen, it has been reported, fuelling speculation of job losses.

The company announced restructuring plans last month following a fall in oil prices, which has seen the price per barrel tumble from a high of $115 to less than $48.

Some 15,000 of BP’s employees are based in the UK, while the company employs about 84,000 people worldwide.

It warned last month that the rate of job losses across the UK and abroad will increase, with the focus likely to be on head office and back office roles rather than front-line operations.

So far, the turmoil has led to the closure of oil field services firm Archer’s Blyth base and confirmation that subsea firm Flexlife was reviewing its Gateshead operations.

Meanwhile, Darlington-based subsea engineering specialists DeepOcean also expects jobs to be lost as part of a company reorganisation.

Equipment at DeepOcean
Equipment at DeepOcean
 

Bank of England governor Mark Carney said the plunge in oil prices represents a “negative shock” to the Scottish economy.

Mr Carney maintained that the decline, which has fed through to ultra-low inflation which it is hoped will boost consumer spending, was an overall positive development for the UK.

But he admitted that Scotland, which is heavily reliant on North Sea reserves, would face a hit from the fall, which has seen the price of a barrel of Brent crude tumble by more than half since last summer to as low as 50 US dollars, a near six-year low.

His comments came as Scotland’s First Minister Nicola Sturgeon said the falling price of oil does pose a risk to jobs in the North Sea and announced that a task force was being set up to help the sector.

Energy Secretary Ed Davey is meeting oil and gas industry officials but unions have warned cuts caused by the slump in oil prices could cause “serious long-term damage” to the UK’s energy capacity.

Mick Cash, general secretary of the Rail, Maritime and Transport union, said: “In the wake of the current price slump RMT is demanding that Westminster and the Scottish Parliament adopt a crisis management approach to ensure sustained production, maintenance of infrastructure, retention of skills, and a robustly regulated regime in the future.

BP
BP
 

“Warm words from Ed Davey have to be matched by sharp and decisive action.

“If immediate action isn’t taken then we risk turning today’s crisis into longer term damage that would threaten the very core of our offshore industry. This is no time for playing politics when the security of UK energy supplies is on the line.

“The expected BP announcement confirms the RMT warning that tens of thousands of jobs in the industry are at stake, along with the prospect of lasting damage to infrastructure, production capacity and the safety culture.

“Intervention is absolutely critical and that is the case that we are setting out today to the politicians north and south of the border and from all sides.”

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