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(Reuters) – Ovintiv (NYSE:OVV) Inc said on Thursday it laid off 25% of its total workforce this month as the oil and gas producer grapples with plunging fuel demand and lower prices due to the COVID-19 crisis.
The company said it now has around 2,100 employees and contractors.
Ovintiv, formerly known as Encana, completed a change of base from Calgary to Denver in January, which Chief Executive Officer Doug Suttles had reasoned would allow the company access to a deeper capital market.
However, that vision was shattered as the pandemic eroded oil demand, while prices tumbled further after Saudi Arabia and Russia in March threatened to flood the market with more oil.
Many shale producers have lately reduced their workforce, slashed budgets and cut dividends in efforts to save enough cash for survival as investors turn their backs on the industry.
Ovintiv’s shares have more than halved in value so far this year, while U.S. oil prices have fallen about 38%.
The company in May cut https:// its second-quarter planned capital spending by 60%, or $500 million, and estimated to have curtailed net volumes of about 65,000 barrels of oil equivalent per day (boepd).
Chevron Corp (NYSE:CVX), the second-largest U.S. oil producer, and oilfield services providers Schlumberger NV (NYSE:SLB) and Halliburton (NYSE:HAL) Co are some of the biggest names among many that have announced job cuts.
Ovintiv, once among Canada’s largest companies, bought Texas-based Newfield Exploration Co for $5.5 billion last year to boost acreage in the United State, as it prepared to move away from Canada.
A company spokeswoman had earlier said the job cuts would be equally spread across its offices in Calgary, Denver and The Woodlands, Texas.
