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Oil/Gas Job Cuts Continue in Appalachian Basin

Oil and gas industry jobs continue to be eliminated in the Appalachian Basin as more companies -- primarily in the supply chain and oilfield services sectors -- announce broad layoffs that have left more than 1,500 people without jobs.

Those cuts have been announced in WARN Notices filed in Ohio, West Virginia and Pennsylvania since the beginning of the year. The notices are required by federal law whenever a business plans layoffs of 50 or more employees. But federal and state data have also continued to show that the industry retrenchment is deeper, with thousands of jobs being eliminated in the region's mining and logging sectors, which include oil and gas extraction, but not related activities such as pipeline construction or natural gas distribution, among others (see Shale Daily, June 19).

Recent announcements from Belmont County, OH-based Stingray Pressure Pumping LLC demonstrate how the job cuts have crossed over state lines, where many companies have been working in both the Marcellus and Utica shales. In separate notices filed in Pennsylvania and Ohio, Stingray said it would lay off about 47 employees working on its frack crews in both states.

Gulfport Energy Corp., which owns 50% of the equity interests in Stingray, according to Securities and Exchange Commission filings, plans to drop the company's frack crews working for it in Monroe County, OH, Stingray said in its filing with the state. In Pennsylvania, Stingray, which provides completion, cementing and logistics services, said EQT Corp. plans to drop its services in Washington County in the southwest part of the state, where the producer has said it is switching to a dual-fuel fleet to displace some use of diesel fuel.

The Stingray layoffs are expected to be made in October and November, the company said. Oilfield services firms have been hit particularly hard by the downturn in oil and gas prices as producers require fewer services and have pushed heavily for contract concessions to lower their own prices. Some of the larger firms that announced worldwide cuts earlier this year said they would be made in stages, meaning more could be made in the Northeast in the coming months (see Shale Daily, Feb. 11; Feb. 5).

A review of WARN Notices filed since January in all three states shows that many of the 1,541 layoffs announced in the industry were filed by oilfield service providers, including Halliburton Co., FTS International and Seventy Seven Energy Inc., among several others. About 834 mass layoffs were announced across the industry in Pennsylvania, 658 in Ohio and 49 in West Virginia since the beginning of the year. U.S. Steel Corp. accounted for 636 of the Ohio layoffs after it cut jobs at a tubular products plant in the Northeast part of the state that makes drill pipe.

Moreover, Consol Energy Inc., Chevron Appalachia LLC, Noble Energy Inc. and Chief Oil & Gas LLC have all publicly announced more than 300 layoffs in the basin.

According to the Pennsylvania Department of Labor & Industry, the state's mining and logging sector employed 35,500 people in August, the latest period for which data is available. That's down from 38,100 jobs in August 2014. In Ohio, the sector employed 14,200 people in August, down 7.2% from the year-ago period, and in West Virginia it employed 27,100 people, down 10.3% from August 2014, according to federal jobs data.

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