Tullow Oil Kenya has summoned its staff in Kenya in an emergency meeting notifying them of possible job cuts at the firm.
In an internal memo issued by Tullow’s Managing Director Martin Mbogo, indicated the structuring of the company’s business, a move which will see some roles reduced to redundancy.
The memo said the resolution was brought about by tough financial position at the company’s group level.
“These factors have significantly affected the ability of the company to continue sustaining the high human resource wage bill. Resultantly, it is now inevitable that there may be job losses and redundancies at all levels and cadres of our organization,” read part of the memo.
Tullow Group, which is a partner with the Kenyan government in the extraction and exportation of oil in Turkana has had mixed fortunes in the market.
On December 9, 2019, the British operator let go its Chief Executive Officer Paul McDade in what was termed as depressed production outlook in its Key West African market.
As a result, it resolved to fix its free cash flows to include the reduction of capital expenditure, operating costs and corporate headwinds.
“A review of the production performance issues in 2019 and its implications for the longer-term outlook of the fields has been undertaken and has shown that the Group needs to reset its forward-looking guidance,” read part of the statement.
In the half-year to June, Tullow posted a net profit of Ksh.10.5 billion ($103 million) supported largely from growth in discovered resources, lower operational costs and a slide in short-term debt maturities.
Nevertheless, its revenues slid to Ksh.88.9 billion ($872 million) with free cash flows falling to Ksh.18.5 billion ($181 million) from Ksh.39.8 billion ($390 million) in a corresponding 2018 review.
Tullow has a local staff base of 650 and has been the principal operator of Project Oil Kenya having entered the domestic scene in 2010 after signing agreements to gain 50 percent operated interest in five onshore licenses.
