Dong Banks on E&P after Job Losses

Dong Energy said Thursday that it sees "great potential" in its exploration and production activities as it announced that it would be cutting up to 600 jobs across it business.

The Danish firm said that in order to improve its future earnings capacity and enhance its capital structure, it would be implementing an efficiency plan by the end of 2012 to cut costs by DKK 1 billion ($174 million) annually, which include the loss of between 500 and 600 jobs.
The plans were announced as Dong reported results for the first nine months of 2012 that showed a pre-tax loss of DKK 2.4 billion, which was down DKK 5.9 billion on the first nine months of 2011. The company had to make a DKK 2.3 billion provision for three long-term, loss-making gas storage facility contracts in Germany. A further DKK 0.6 billion was written down that was connected to a loss-making contract for capacity at an LNG terminal in the Netherlands.
Consequently, Dong has lowered its EBITDA outlook for 2012 to a range between DKK 8.5 billion and DKK 9 billion.
Dong CEO Henrik Poulsen commented in a statement:
"The results we have delivered for the first nine months of the year are  unsatisfactory and so is the fact that we have had to lower our EBITDA outlook  for 2012. This is due, in particular, to a European gas market marred by  oversupply and low margins, partly because low CO2 and coal prices make the coal-fired power stations more competitive than the gas-fired power stations. 
This has been an instrumental factor in considerable provisions and a  significant deterioration in the earnings trend in the Energy Markets business area.
"The other four business areas are performing in line with expectations. For example, we still see great potential in our two primary growth areas, Exploration & Production and Wind Power."

Have a news tip? Share it with Rigzone!


Click on the button below to add a comment.
Post a Comment
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.

Related Companies

Our Privacy Pledge

More from this Author
Rigzone Staff
e-mail us at
 -  Inpex Hits Gas Offshore Japan (Oct 28)
 -  NNPC, Nigeria Police Pledge Collaborat... (Oct 28)
 -  TGS Expects E&P Spend to Dip by up to ... (Oct 28)
 -  Roxi Hits Oil in Kazakhstan's Deep Wel... (Oct 28)
 -  Aker Solutions to Buy Brazilian C.S.E (Oct 21)

Most Popular Articles

From the Career Center
Jobs that may interest you
Assistant Operations Manager
Expertise: Marine Surveying|Operations Management|Surveying
Location: New Orleans, LA
Operations Tech (Offshore Drilling & Completion)
Expertise: Document Control|Laboratory Ops / Tech|Secretarial or Administrative
Location: Houston, TX
SXL - Senior Counsel, Corporate Finance & Securities
Expertise: Accounting
Location: Newtown Square, PA
search for more jobs

Brent Crude Oil : $50.47/BBL 0.98%
Light Crude Oil : $49.72/BBL 1.09%
Natural Gas : $2.76/MMBtu 1.09%
Updated in last 24 hours