Seismic contractor TGS will reduce its global workforce capacity by some 130 people, corresponding to around 16 per cent of its total workforce.
According to Oslo-listed company, this would reduce operating expenses by approximately USD 13 million per annum from the beginning of 2016.
“This was a very difficult decision and we are committed to assure that the employees leaving the company through this necessary action will be treated with dignity and respect in accordance with TGS’ values,” the company said in a press release today.
A restructuring cost of USD 8 million will be charged to the accounts for Q4 2015.
Furthermore, TGS said it expects total impairments of some USD 150 million for approximately 10 per cent of its surveys in the balance sheet to be recognized in the Q4 2015 accounts. According to TGS, the impaired surveys were all acquired during the peak of the market with substantially higher cost levels than seen currently.
Robert Hobbs, CEO of TGS, said: “Although the TGS library continues to perform well compared to the industry, we have chosen to take a cautious view when evaluating the net book values. The cost of shooting the same seismic today is dramatically lower than two to three years ago and this has of course played a role in our assessment.”