Royal Dutch Shell plc is set to announce “substantial” job cuts in the coming days, sources told NGI Friday.

Shell CEO Peter Voser in July said the producer would cut a quarter, or around 150, of its 700 senior management jobs, and he announced a 10% cut to capital spending in 2010 (see Daily GPI, July 31). However, more job-reduction announcements are imminent, according to internal e-mails sent to upstream managers. The e-mail indicated the “coming days will bring more information about the reorganization,” two people familiar with the memos said.

In a separate posting made in the past few days on Shell’s intranet, Voser is said to have written, “ongoing changes will result in significant staff reductions,” said a source. The staff reductions are to be submitted to Shell’s works council, a consultative group that employees and managers use to discuss staff policies. Shell did not confirm the information.

A restructuring by Shell intended to streamline operations, cut overhead and speed decision-making took effect July 1 (see Daily GPI, May 28). The upstream activities were reorganized to consist of two businesses: Upstream Americas, covering North and South America; and Upstream International, covering the rest of the world. Shell’s Downstream unit was expanded to include Trading and Alternative Energy, excluding Wind, which became part of Upstream. A new division, Projects and Technology, manages the design of all major projects upstream and downstream.

Shell earlier had indicated that its reorganization efforts would affect about a quarter of its 102,000-member workforce. Most of the job losses were predicted to come from buyouts, attrition and the loss of some contract jobs.

Standard & Poor’s Ratings Services (S&P) Thursday downgraded Shell’s debt because of the company’s decision to maintain high capital spending and dividends despite increases in debt. S&P also said it was concerned about the size of the deficit in Shell’s pension plan, which was $25 billion at the end of 2008. S&P projected Shell’s debt, excluding off-balance sheet pension liabilities, to exceed $35 billion by the end of 2010, almost twice the $19.5 billion at the end of June.

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