Subsea 7 will reduce headcount by 3000 from its global workforce of 12,000, by the end of the second quarter of 2021.
The decision forms part of a proposed cost reduction programme announced by the group, which owns offshore wind subcontractor Seaway 7, following initial guidance provided on 30 April.
Subsea 7 chief executive John Evans said: “Faced with a significant deterioration in the oil and gas market, we are taking swift and decisive action to address the elements under our control.
“These measures to reduce our cost base will help preserve cash and protect our balance sheet strength, while maintaining our strong competitive position in core markets.”
Subsea 7 anticipates that two-thirds of the reduction would affect the non-permanent workforce and one-third of the reduction would affect permanent employees.
Discussions with employee representatives will take place on a local basis and consultation will start soon said the company.
Subsea 7’s active fleet of 32 vessels will be reduced by up to 10 vessels through the non-renewal of chartered tonnage and the stacking of owned assets.
The reduction and “reshaping” of the fleet will take place over the next 12 months.
As previously indicated, the cost reduction measures are expected to deliver approximately $400m in annualised cash cost savings from the second quarter 2021.
Capital expenditures will be reduced to minimal levels in 2021 and 2022.