Chesapeake Cuts Workforce by 15%



Chesapeake Energy Corp., the second-largest producer of natural gas in the United States, has laid off 15 percent of its entire workforce, or 740 employees, the company confirmed to Rigzone.

The company, which has headquarters in Oklahoma City, implemented the workforce reduction as “part of an overall plan to reduce costs and better align its workforce with the needs of the business and current oil and natural gas commodity prices,” according to a Sept. 29 SEC filing. The office in Oklahoma City will feel the worst of the reduction, with 15 percent, or 562 employees, impacted. 

“As you are fully aware, the current commodity price environment continues to be a challenge for our industry and Chesapeake,” an internal memo from Chesapeake CEO Doug Lawler sent to all employees Tuesday afternoon, stated. “Over the past year, we have taken significant actions in response to the low commodity prices by reducing our costs and decreasing capital spending.”

Lawler also stated the layoffs were across all functions of the company and that eligible employees would receive severance packages and career transition/outplacement assistance.

According to its corporate fact sheet, Chesapeake had 5,500 employees as of Jan. 1. The employee count after Tuesday’s layoffs is about 4,000 according to an email sent to Rigzone. The Oklahoma City employee count is now about 2,500.

As part of the reduction, Chesapeake will incur a one-time charge of $55.5 million in 3Q 2015, which includes employer payroll taxes.

Chesapeake has operations in the top shale plays in the United States, including the Eagle Ford, Utica and Marcellus. The company’s shares closed at 6.79 Sept. 29 in New York Stock Exchange Trading, though shares began trading lower during after-hours.



WHAT DO YOU THINK?


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