January 9, 2015 / 7:27 PM / 5 years ago

Shell to cut 5 to 10 percent of jobs at oil sands project

CALGARY, Alberta (Reuters) - Royal Dutch Shell Plc (RDSa.L) will cut between 5 and 10 percent of the just over 3,000 jobs at its Albian Sands mining project in northern Alberta, a company spokesman said on Friday, although he refrained from connecting the move to plunging oil prices.

Logos for Shell are seen on a garage forecourt in central London March 6, 2014. REUTERS/Neil Hall

Spokesman Cameron Yost said the actual number of job reductions at the Canadian operation had not yet been finalized, adding it would be “well below” 10 percent.

The cuts were announced to Shell employees on Thursday.

Yost said those affected will be considered for other positions within Shell’s operations.

“It’s not layoffs in the traditional sense of the word,” Yost said. “It’s adjustments to the organizational structure.”

Albian Sands is the mining portion of Shell’s Athabasca Oil Sands project near Fort McMurray, Alberta, which also includes the 255,000 barrel-per day Scotford upgrader.

Last February, Shell halted work on its proposed 200,000 bpd Pierre River oil sands mine in Alberta, saying it was re-evaluating the timing of various asset developments.

Asked whether the reductions were related to the halving of global oil prices in the past six months, Yost said: “Even if oil price had remained stable we would still be looking at these areas of our business.”

Global oil prices sank to their lowest level since April 2009 on Friday on persistent worry over a global supply glut.

Other companies operating oil sands mines in Alberta are Imperial Oil Ltd (IMO.TO), Suncor Energy Inc (SU.TO), Canadian Natural Resources Ltd (CNQ.TO) and Canadian Oil Sands Ltd COS.TO, which is the largest-interest owner in the Syncrude project.

All four said they have not reduced employee numbers at their projects.

Editing by Peter Galloway. Editing by Andre Grenon

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