/Husky Energy reportedly lays off dozens in Calgary

Husky Energy reportedly lays off dozens in Calgary

Oil and gas giant Husky Energy on Tuesday laid off what some staffers are saying was hundreds of Calgary employees amid continuing doldrums in Canada’s oilpatch.

A number of staffers could be seen leaving the company’s 8th Avenue S.W. office tower to a lineup of waiting taxis, clutching paperwork suggesting they’ve been let go.

A company spokeswoman confirmed the layoffs but wouldn’t say how many employees have been affected.

“Today we did have to say goodbye to some of our colleagues,” Kim Guttormson said in a statement.

“Husky has been taking steps to better align the organization and workforce with our capital plan and strategy.”

She said the move was made to help ensure the company can “achieve its goals.”

“This was about changing the way we approach our business, the way we make decisions and the way we work together to meet our goals,” said Guttormson.

One employee who survived the cuts said hundreds of employees, including dozens of close co-workers, were laid off quickly and escorted outside.

“There were meeting rooms on 40 floors to break the news to people,” said the staffer, who wouldn’t provide a name.

“It was fast, they didn’t mess around and they had extra security . . . the lineups (of those being laid off) were so massive, you couldn’t get a coffee.”

The staffer said the sensation of working for a politically beleaguered industry, particularly after Monday’s federal election, is strong among Husky employees.

Husky shares have plummeted by 80 per cent since a 2008 peak, widely attributed to slumping oil prices, a suspension in dividends and an abortive $2.75-billion hostile takeover of MEG Energy Corp.

The Husky Energy building in Calgary on Tuesday, October 22, 2019. Brendan Miller/Postmedia

Brendan Miller/Postmedia

In January, the company cited the then-NDP government’s production curtailment to reduce the price differential hurting western Canadian crude for the MEG failure, along with a “continued lack of meaningful progress on Canadian oil export pipeline developments.”

On Thursday, the company will release its third-quarter results.

Late last year, Husky reduced its 2019 spending budget by $300 million in response to those production curtailments and continued low energy prices.

The Kenney government extended the curtailment program through 2020 but has eased the program’s levels.

The latest layoffs follow a wave of recent job losses in the sector that have continued since the collapse of oil prices five years ago.

In June, Spanish firm Repsol SA cut 30 per cent of its Canadian workforce as part of a global restructuring move.

Alberta’s new UCP government has implemented $4.5 billion in tax cuts over the next five years, insisting the move will increase employment.

But the Opposition NDP says it’s so far failed to do that amid rising job losses.

“This government made a $4.5-billion handout with no assurances it’ll create jobs,” said the party’s energy critic, Irfan Sabir, who said Husky benefited to the tune of $233 million from the tax cut.

“We know this pattern has repeated across all of the major energy firms in Alberta.”

He also said the province’s decision to cancel the NDP’s contracts to move oil by rail has stranded 120,000 barrels of oil a day, further dimming employment prospects.

Husky recorded a first-quarter profit this year of $248 million.

The UCP government has said those tax cuts will bear fruit over time and that those oil-by-rail contracts are going to the private sector to boost product transportation.

An investment analyst said Husky’s layoffs are a harbinger of more tough times in Alberta’s already battered energy sector.

“I’m not surprised to hear of more layoffs, we’re seeing that throughout the energy sector and they’re not done trying to cut costs out of the business,” said Jennifer Rowland of Edward Jones.

“It’s going to remain tough through 2020 — people can’t rely on being bailed out by a higher oil price.”

Rowland said a shortage of pipeline access is another factor in a grim outlook for the province’s energy sector.

“(Investment) will be either flat or down . . . I’d really be surprised to see any projects of significance being announced in the near term,” she said.

— With files from Chris Varcoe

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Twitter: @BillKaufmannjrn

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