Oil drilling services firm MHWirth has announced the closure of its Stockton base, threatening the future of around 18 jobs.
In the face of an abrupt decline in drilling jobs caused by recent falls in oil price, the firm will close its Preston Farm Industrial Estate operation just three years after it talked of employing 200 staff at the site.
A spokesperson for MHWirth confirmed the Stockton office would close by the end of Q2, 2015, due to the “market situation”.
The move is part of a global plan to shed up to 750 jobs from MHWirth, which is the largest unit within Norway’s Akastor, and was split off from Aker Solutions last year.
The drilling technology division currently employs 15 permanent members of staff and three contractors, although MHWirth said it was still too early to confirm what would happen to these jobs.
In 2012, when the Stockton operation was still part of Aker Solutions, plans were announced to bring headcount to 200 with the opening of a new drilling services office.
Aker planned to employ product engineers to work on topside drilling equipment to feed its deepwater drilling services activity.
At the time bosses cited “excellent oil and gas engineering competence in the North East of England” but market conditions in the oil industry have since deteriorated due to falling prices.
News of MHWirth’s restructuring follows manoeuvres by several other North East oil and gas supply chain operators hit by shrinking project spend among large oil firms.
In December oil field services firm Archer abruptly closed its Blyth office, while subsea umbilicals specialists Flexlife confirmed their Newcastle operation was under review.
International reorganisation at subsea engineering firm DeepOcean is expected to spell job losses in Darlington, and earlier this month the Norwegian parent company of Stockton’s Reef Subsea UK filed for bankruptcy, calling into question the future of the North East operation.
Jobs pruning at MHWirth comes as parent company Akastor aims to save around £51.8m.
Norwegian media has reported that between 200 to 300 jobs of the 750 globally will be axed from Akastor’s Norwegian operations.
The company currently employs a total of 4300 staff in 20 offices worldwide, including Oslo, Stavanger and Bergen in Norway.
Until last year Aker had a presence in Stockton since 1986. In 2012 the base employed around 100 staff to handle global IT, finance, accounting and HR and its specialist recruitment agency functions.