Anadarko May Lay Off 500 Houston Workers Amid Asset Sales
HOUSTON Jan 23, 2007 (Dow Jones Newswires)
Anadarko Petroleum Corp. (APC) could shrink its Houston-area workforce by as much as a quarter as the company restructures in the wake of recent acquisitions, a spokeswoman said Tuesday.
The job reductions are a result of Anadarko's ongoing sale of oil and gas assets to pay for its $21.1 billion acquisition of Kerr-McGee and Western Gas Resources, Anadarko spokeswoman Teresa Wong said. "We'll have a number of employees impacted by that," she said. Anadarko has recently agreed to divest assets in Wyoming, Louisiana, and Texas, and last year sold properties in Canada and the Gulf of Mexico. The company is still peddling operations in Qatar, Venezuela, the "Golden Trend" in Kansas and Oklahoma, and a partial interest at the K-2 complex in the deepwater Gulf of Mexico.
Anadarko seeks an $11 billion to $15 billion gain, and if proceeds reach the upper end of that range, the company won't have to issue any additional equity to reduce debt.
The Woodlands, Texas-based oil and gas company could lay off "at least 500 employees" in the Houston area, Anadarko said in a letter to the Texas Workforce Commission dated Jan. 11. The company has 2,200 employees in the Houston area and about 5,000 workers globally, said Wong.
The layoffs will occur between Feb. 1 and May 30. Most of those affected will receive six months' severance pay and help looking for new employment, according to the letter.
The figure is an estimate, Wong said. The number of employees who could lose their jobs "could be more, (or) could be less," Wong said.
Employees in field offices could also be affected by divestitures, she said.
Other employees have left Anadarko in previous divestitures, such as the sale of the company's Canadian subsidiary, which had about 700 people, Wong said.
The cuts, however, come at a time when there's great demand in the oil industry for qualified personnel.
Company officials said in a recent analyst meeting that once the divestiture process is over, Anadarko will have a less capital-intensive footprint that will provide better returns.
"In the end, we're going to be a company that's about the size of Anadarko before the mergers," Wong said. "We need to match the employees to the size of the company."
Anadarko shares were trading 83 cents, or 1.95% higher at $43.37, Tuesday at about 12:36 p.m. EST.
Copyright (c) 2007 Dow Jones & Company, Inc.
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