Devon Cuts Some Jobs Amid Merging Of Divisions

Independent oil & gas producer Devon Energy said it's eliminating some positions as a result of the merging of its Gulf of Mexico and international divs. Devon spokesman Chip Minty told Dow Jones Newswires no more than 75 positions will be affected by the restructuring. He said the company is cutting some jobs to eliminate duplication of work while others move to another part of the company. According to a person close to the Oklahoma City-based company, which has about 5,500 employees, at least half a dozen managers were laid off Wed. & more cuts are likely to come. Devon plans to combine its international & Gulf divs. into 1 offshore unit, to be based in Houston. The consolidation will let Devon share knowledge & resources, said Dave Hager, Devon's Executive VP of exploration & production. Devon's move comes at a time when oil & natural gas producers are trying to survive a period of low earnings due to a sharp drop in commodity prices. Many companies announced plans to reduce costs including pressuring oil service contractors to low prices, streamlining operations & lay off employees. Oil giant Royal Dutch Shell, unveiled a shake-up of its org. and management including the merger of 3 divisions that could affect thousands of employees. ConocoPhillips, the 3rd largest U.S. oil company by market value after Exxon Mobil & Chevron, said early this year it was delaying some oil & gas projects in North America, & confirmed it's cutting 1,300 workers, or about 4% of its staff. Apache, another large independent oil & gas producer, said in April it laid off 6% of its global workforce. "Consolidating operations in this environment makes a lot of sense because companies are under a lot of pressure. They are cutting their own costs because they are not going to wait for oil & gas prices to bail them out," said Fadel Gheit, Oppenheimer analyst. Devon and other energy companies like Anadarko Petroleum Corp. are in the process of cutting costs & idling rigs to cope with the steep drop in energy prices. The price of natural gas has fallen about 72% from its summer-time high of $13.694 M British thermal units and the price of oil has dropped by about 55% since hitting an all-time high above $145 a barrel.