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Woodlands exploration company to consolidate, job cuts expected

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Newfield Exploration Co. (NYSE: NFX) announced May 10 that it plans to consolidate operations to its headquarters in The Woodlands.

The move will “result in a significant reduction of employees” in Newfield’s office in Tulsa, Oklahoma, the company said in a filing with the U.S. Securities and Exchange Commission. However, specific details were not provided. As of Feb. 19, Newfield had 1,111 employees, and all but 53 were located in the U.S.

“The consolidation is expected to improve business and cost efficiencies in operations and margins in today’s continuing low commodity price environment,” Newfield said in its May 10 filing.

Last year, Newfield closed offices in Denver and north Houston’s Greenspoint area in a similar consolidation.

Also on May 10, the company announced a broader reorganization that will affect Newfield’s headquarters and some field offices. Both the consolidation and reorganization are expected to be complete by the end of the third quarter.

Currently, Newfield expects that one-time charges associated with the consolidation and reorganization will be between $30 million and $36 million, including severance payments of between $18 million and $23 million. However, those figures may change depending on several factors, including how many employees agree to relocate.

Less than a week ago, Newfield announced it would acquire Oklahoma assets from a subsidiary of Oklahoma City-based Chesapeake Energy Corp. (NYSE: CHK) for $470 million.

The news also comes a week after Newfield reported a net loss of $624 million, or $3.52 per diluted share, for the first quarter. That includes a full-cost ceiling test impairment of $506 million, or $2.85 per share. After adjusting for the effect of impairments, credit facility amendment fees and unrealized derivative losses, Newfield’s net loss would have been $16 million, or 9 cents per share.

Meanwhile, revenue fell 18.6 percent year over year to $248 million in the first quarter.

Newfield is the Houston area’s 61st-largest public company, based on its 2014 revenue of $2.29 billion. In 2015, revenue dropped nearly 32 percent year over year to $1.56 billion.

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