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Canadian oil producer Suncor Energy to cut 1,500 jobs under new CEO

Published Jun 02, 2023 02:19PM ET
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© Reuters. FILE PHOTO: The Suncor Energy logo is seen at their head office in Calgary, Alberta, Canada, April 17, 2019. REUTERS/Chris Wattie/File Photo
 
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(Reuters) - Canada's second-biggest oil producer Suncor Energy (NYSE:SU) has told employees it plans to cut 1,500 jobs this year, two sources confirmed to Reuters on Friday, in one of the first big moves by its new CEO.

In a staff memo announcing the layoffs, Suncor also told employees it was seeking C$400 million ($297.64 million) in cost savings, according to one of the sources. The company had 16,558 employees at the end of 2022, not including contractors.

In November, Suncor announced it would reduce its contractor workforce in the mining and upgrading business by 20%. Rival Imperial Oil (NYSE:IMO) also cut the number of contractors working at its Kearl oil sands site in northern Alberta as part of cost-saving measures this year.

Oil prices have fallen from a year ago, but producers are still recording big profits.

On Thursday a media report from the Canadian Press said Suncor planned to eliminate the jobs by year-end to reduce costs and improve its financial performance. It was unclear in which part of the company the layoffs would take place.

"Suncor is always looking for opportunities to drive value and improve performance in our business, cost reduction is one of those opportunities," Suncor told Reuters on Thursday, without providing further details.

In May, new Suncor CEO Rich Kruger said in his first call with analysts that he would look to cut costs, improve efficiency and simplify operations.

The company has been under pressure from activist investor Elliott Investment Management, which owns about 3% of Suncor, over its operational and safety record, including over a dozen fatalities at its sites since 2014. Last year, Suncor reached an agreement with Elliott to appoint three new independent directors.

Suncor shares were last up 2.9% at C$39.12 in Toronto.

($1 = 1.3439 Canadian dollars)

Canadian oil producer Suncor Energy to cut 1,500 jobs under new CEO
 

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