Shell will lay off 10,000 staff and direct contractor positions as it merges with the BG Group while also dealing with the effects of falling oil prices.
In a written statement early Thursday, CEO Ben Van Beurden said, “The completion of the BG transaction, which we are expecting in a matter of weeks, marks the start of a new chapter in Shell, rejuvenating the company, and improving shareholder returns.”
The announcement came following a fourth quarter in which the U.K. incorporated company, headquartered in The Netherlands, posted a 44% drop in earnings. Shell did not indicate which areas will lose positions.
Royal Dutch Shell announced its purchase of British rival BG Group for $69.7 billion in cash and stock on April 8.
Analysts at Wood Mackenzie said at the time low prices are gradually prompting most major oil companies to weigh acquisitions, though only a few have the size and resources to pull off a mega-merger.
“If you’re looking to the next big deal, ExxonMobil stands out as most likely to pull the trigger,” Wood Mackenzie wrote in a research note.
PGJ staff report