(Reuters) - Southwestern Energy Co said it would lay off 1,100 employees, or nearly 40 percent of its workforce, as it slows down drilling activity in response to a prolonged slump in oil prices.
Oil futures dropped to their lowest levels since 2003 this week on worries of a growing crude glut amid slowing demand due to economic weakness, especially in China.
Southwestern had no drilling rigs in operation at the start of 2016 and is yet to finalize its capital budget and operating plan for the year.
The company said on Thursday it expects to record a pre-tax charge of about $60 million to $70 million related to the job cuts in the first quarter.
Southwestern also said the latest round of job cuts along with the 102 layoffs in August would lower its annual costs by $150 million to $175 million.
The company had 2,781 employees at the end of 2014.
Up to Wednesday’s close of $7.38, Southwestern shares had lost about 70 percent of their value over the past year.
Reporting by Swetha Gopinath in Bengaluru; Editing by Savio D’Souza
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