UK

BP Cuts 300 North Sea Jobs After Oil Price Plunge

15/01/2015 13:56 GMT | Updated 15/01/2015 13:59 GMT
Nick Ansell/PA Wire
File photo dated 15/8/2013 of a BP petrol station sign in Chelmsford, Essex. Energy giant BP has said the future of North Sea oil and gas is best served by maintaining the integrity of the United Kingdom.

Energy giant BP has announced hundreds of job losses amid the plunging price of oil, sparking warnings of further cuts and calls for government action.

The firm said it expects to shed 200 onshore staff, while 100 contractors' posts will also be axed, which unions said was a "devastating blow" to the industry.

Holyrood's Energy Minister Fergus Ewing demanded action from the UK Government, saying the employment threat from the oil price fall has produced the the most serious jobs situation Scotland has faced "in living memory".

Energy Secretary Ed Davey, who was visiting Aberdeen to talk to leading figures in the North Sea oil and gas sector, said he had "huge sympathy" with the workers losing their jobs.

He told the Press Association he was meeting industry chiefs to see what could be done to maintain jobs in the sector and help anyone being laid off.

"We want to do everything we can to minimise any impact. The North Sea is crucial to Britain's energy industry and is a vital part of our economy."

Unions fear today's news is the first in a series of announcements from oil firms as a result of cheaper prices.

Trevor Garlick, regional president for BP North Sea, said: "We are committed to the North Sea and see a long- term future for our business here. However, given the well-documented challenges of operating in this maturing region and in toughening market conditions, we are taking specific steps to ensure our business remains competitive and robust, and we are aligning with the wider industry.

"Whilst our primary focus will be on improving efficiencies and on simplifying the way we work, an inevitable outcome of this will be an impact on headcount and we expect a reduction of around 200 staff and 100 contractor roles. We have spoken to staff and will work with those affected over the coming months."

Mick Cash, general secretary of the Rail, Maritime and Transport (RMT) union, said: "The announcement from BP is a devastating blow to hundreds of workers in the UK energy industry and we are being warned that there is much worse to come.

"RMT believes that the industry is making offshore workers carry the can for their failure to plan for lean times such as these. Instead they have gone for a short-term slash-and-burn approach that will have long-term implications for the future of the entire industry and the security of the UK's energy supplies.

"RMT, along with our sister unions, is meeting with Oil and Gas UK tomorrow, where we will be pushing for a halt to the job cuts programme and an emergency package of measures to stave off the destruction of both jobs and infrastructure.

"We are also continuing to lobby politicians for incentives to allow exploration, maintenance, safety and engineering development works to take place during this emergency period for the industry."

With Chancellor George Osborne due to unveil his final Budget in March before the general election, Davey suggested extra help could be made available for the North Sea.

Ewing said the two Governments needed to "put the politics aside" and get a new tax deal implemented for the North Sea "because it will save jobs".

He insisted action was needed before the Budget, warning that "unless there is swift action to introduce that tax package, then investment decisions will be made between now and March prematurely to decommission fields which should carry on in production for many years, if not decades, to come".

Scotland's First Minister Nicola Sturgeon was in Aberdeen yesterday where she announced a new task force to help address the threat to jobs that comes from the drop in oil prices.

Ewing told BBC Radio Scotland's Good Morning Scotland: "Our thoughts are with all the people in the north east of Scotland in particular who face job losses at this time. That is why the First Minister announced yesterday the formation of a task force."