Halliburton Layoffs 2019: 800 Lose Jobs As Oklahoma Plant Shuts Down

Halliburton, the American oilfield service company based in Houston will close its operations in El Reno, west of Oklahoma City and lay off more than 800 employees.

Halliburton is the second-largest oilfield service company in the world. Although it is still profitable, the company has been reducing the workforce in response to the slumping demand for its technology and services in the slowing oil sector.

The decision to terminate hundreds of USA jobs was communicated in a letter to the Oklahoma Office of Workforce Development. The Monday letter by Michael Queener, Halliburton Vice President of the MidCon Area said company the looking close its office in El Reno.

“The layoff is expected to be a permanent employment loss,” Queener wrote in the letter.

The El Reno field camp handles a dispatch command center and houses several hydraulic fracturing crews. Among the 808 employees to be laid off, one third worked with acids used in the hydraulic fracturing process and one-tenth of the team handles cementing work for oil wells.

Halliburton's lay off coincides with the slump in the oil market with oil price hovering around $50 per barrel dampening new investments. The softening in the shale sector in terms of low demand for drilling and completion activity across the United States and Canada has also contributed to the job cuts.

Halliburton has already reduced 8 percent of its North American workforce in the second quarter and also chopped 650 jobs in four western states in October.

The century-old company employs more than 60,000 personnel in 40 countries. Halliburton posted a profit of $1.66 billion during 2018 with $24 billion as revenue.

Reacting to the Halliburton layoffs and closing of its El Reno operation, city mayor Matt White said besides affecting the employees it will also hit the city’s business and economy.

“They do a lot of shopping in our shops, a lot of eating in our restaurants. It’s going to be traumatic for our sales tax,” White said.

“Christmas is a pretty tough time to do it, but I don’t know that there’s any good time to lose your job,” the Mayor added.

The shale oil sector will survive headwinds

Meanwhile, reports said U.S. shale oil production, despite showing signs of moderation and facing headwinds of slowing production growth will continue to advance.

By 2020 the U.S. is expected to become a net energy exporter exporting more energy products such as oil, natural gas than it imports, per the U.S. Energy Information Administration.

This optimism was endorsed by an expert Jason Bordoff, director at Columbia University’s Center on Global Energy Policy. He told CNBC that the shale story will not be short-lived.

“I think the growth in production is going to slow but it’s still growing.” The comments of Bordoff came during the Abu Dhabi International Petroleum Exhibition & Conference in November.