WesternGeco has just announced the closures of its land seismic operations in the US lower 48 states and Canada. The closure is due to ‘sustained unprofitable market conditions’ according to the company. Downsizing is also expected in other areas of the company, with about 1200 employees to be affected worldwide by the end of the year. Land operations will continue in Alaska and Mexico, as well as other ‘economically viable’ areas worldwide.
Restructuring
The move is part of the company’s restructuring to ‘decrease its emphasis on conventional seismic operations’. According to WesternGeco, such operations have been severely impacted by commodity pricing, excess risk, and difficult terms over the last 10 years. WesternGeco is simultaneously ‘accelerating its move toward the production side of the E&P business.
Jones
WesternGeco President Gary Jones said, “This action is an inevitable result of the high-risk, no-return state of affairs in the seismic industry. We will focus on customers and geographical areas where the value we provide is recognized, and will concentrate our growth in providing advanced reservoir information technology. This move is another step in our long-term commitment to sound business practices, including shutting down losing operations and exiting markets where reasonable terms and conditions do not prevail. However, given fair compensation and acceptable terms, our services are available everywhere to everyone.”
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