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Halliburton, FMC Laying Off Thousands

Halliburton Co., the top hydraulic fracturing (fracking) provider in North America, is laying off up to 6,400 people, 8% of its workforce, as producers cut back, the company said Tuesday. FMC Technologies, which provides subsea and fracking technology, also is reducing its Houston-based workforce by 10%, affecting about 2,000 people.

"We value every employee we have, but unfortunately, we are faced with the difficult reality that reductions are necessary to work through the challenging market environment," a Halliburton spokeswoman said.

No specific areas were announced. The Halliburton layoffs include 1,000 people who were fired in December in operations in the eastern hemisphere. In the latest round of cuts, all areas of global operations are impacted. Halliburton, whose main operations are in North America, employed about 80,000 people worldwide in 2014 and it is the No. 2 oilfield services (OFS) company in the world. It also is the second largest oil tool provider after Schlumberger Ltd.

None of the new layoffs are because of the pending acquisition of Baker Hughes Inc. (see Shale DailyNov. 17, 2014). When that merger is completed, duplication also is expected to eliminate jobs, executives have said.

FMC CEO John Gremp announced his company’s layoffs on Wednesday. FMC manufactures subsea equipment and supplies fracking technology/wellhead services in North America. It has around 20,000 employees worldwide. Most of the job reductions are to be from North American operations.

"We're responding quickly and significantly to the slowdown in our North American business by reducing discretionary and capital spending," Gremp said. The industry is facing a tough year following the collapse in oil prices, he said. FMC is seeing a "significant slowing" in the North American land market as rigs are idled. The downturn is seen continuing over the coming months.

"We're now taking action to address the reduced volumes we'll experience in 2015, and we're confident these steps will allow us to effectively manage through the downturn," said Gremp.

It's difficult to assess how many energy-related jobs already have been lost since the downturn in the oil markets. From the OFS sector alone, the top four companies in the past month have announced they are eliminating as many as 27,500 jobs.

Baker said in January it planned to lay off 7,000 before the end of March (see Shale DailyJan. 20). Schlumberger announced in mid-January it would fire 9,000 people; most of its activity is in North America (see Shale DailyJan. 16). No. 4 OFS, Weatherford International plc, last week said 5,000 people, almost 9% of its workforce, would be laid off by the end of March (see Shale DailyFeb. 5).

Exploration and production companies are culling their workforces as well, but the figures are not as clear and are changing by the day. The hurt has been deep and wide (see Shale DailyFeb. 4Jan. 8). Anecdotally, there is a lot of information available: Antero Resources Corp. early this year laid off about half of its 1,000 contracted land brokers (see Shale Daily, Jan. 6). The majors are not immune either, with BP plc and Chevron Corp. announcing cuts to their workforces and freezes in pay (see Daily GPIJan. 26) OFS vendors, including U.S. Steel, also have laid off thousands and closed facilities.

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