Amoco Canada Petroleum Ltd., Calgary, plans additional work force cuts after reporting an "unacceptable" $481 million loss in first half 1992.
The loss on revenues of $1.8 billion compared with a loss of $129 million on revenues of $2.1 billion in the same period last year. The company had a $510 million loss in second quarter 1992.
This year's losses include a $429 million writedown on the value of oil and gas properties.
Amoco Canada Chairman T. Don Stacy called the financial results unacceptable. The company blamed the loss on weak natural gas prices and special charges related to asset sales.
Amoco Canada plans to reduce its payroll to 2,650 employees, a 42% cut from a staff of 4,500 when it began a downsizing program in 1991. Amoco earlier announced 1,500 of the 1,900 job reductions now planned. Some cuts will be voluntary departures, and some staff will transfer to contractors.
About 100 employees will be cut from the Amoco Canada payroll when many computer functions are shifted under contract to SHL Systemhouse Inc.
Cost cutting measures reduced interest payments on Amoco Canada's $2.62 billion debt by $17 million in first half 1992. Administrative costs were reduced by $71 million or 30% from the same costs in first half 1991.
In addition to weak oil and gas prices, the company has been plagued by high debt servicing costs since its $5.2 billion takeover of Dome Petroleum Ltd. in 1988.
Amoco Canada is setting up a division called Smallco to operate and sell noncore assets.
Copyright 1992 Oil & Gas Journal. All Rights Reserved.
