NAIROBI, Kenya, Feb 6- Tullow Oil Kenya has announced plans to cut a third of its staff to save on administrative costs.
“The company has had to review and assess its financial performance and business operations to ensure resources are allocated in the most efficient way possible and to ensure that the current structure of Tullow is meeting the demands of the business effectively,” said the firm’s Managing Director for its Kenyan subsidiary Martin Mbogo said in an internal memo.
“These factors have significantly affected the ability of the company to continue sustaining the high human resource wage bill. Reluctantly, it is now inevitable that there may be job losses and redundancies.”
The job cuts will affect a third of the company’s workers across all levels and cadres at the organization; these include expatriate, national, contract, fixed term and permanent.
Mbogo said all affected staff will take home salaries up to the date of termination, redundancy severance dues, termination notice or pay in lieu of notice pursuant to the terms of the affected employees’ employment contract and any accrued but untaken leave.
The announcement comes after the Chief Executive Officer of the London listed company stepped down in 2019 and the oil producer scrapped its dividend after failing to meet production targets due to weak performance by flagship assets in Ghana.
The company’s market capitalization stood at around Sh90.3billion as of Tuesday while its debt pile was around Sh281 billion at the end of 2019.
Tullow has now pushed back its full-year results to March 12, when further details of its restructuring are expected.
Late last month, the British firm said it was selling half of its Kenyan stake for Blocks 10 BA, 10 BB and 13T in the South Lokichar Basin.