CALGARY – Employees at TransCanada were informed this week that more job cuts are coming as part of a major overhaul that includes shedding a fifth of senior leadership positions from the pipeline and power company.
“Falling oil prices and the current environment are having a profound impact on our customers and we must do all we can to drive down costs and pursue our projects more efficiently and strategically,” spokesman James Millar said in an emailed statement.
“We are now introducing significant changes that will make us a more nimble organization that will ensure each one of our three business units – natural gas pipelines, liquids pipelines and energy – are able to make the decisions necessary to maintain competitiveness and maximize shareholder value.”
TransCanada’s growth plan includes $46 billion in commercially secured projects that are set to be complete by the end of the decade.
Millar said about 20 per cent of senior leadership positions are expected to be cut when layoffs and retirements are taken into account.
After that, TransCanada will continue to analyze its organizational structure. It’s not clear yet how many of TransCanada’s 6,000 employees may ultimately lose their jobs.
TransCanada eliminated 185 positions from its major projects division in June, the first phase of a process that’s expected to wrap up in November.
Earlier this week, U.S. presidential contender Hillary Clinton came out against TransCanada’s (TSX:TRP) proposed Keystone XL pipeline, a cross-border oilsands conduit that has been stuck in U.S. regulatory limbo for seven years.
Meanwhile, U.S. benchmark crude prices are hovering below US$45 a barrel – about half of what they were a year ago and below what many producers need to turn a profit.
On its second-quarter conference call in July, the company said it was slowing the pace of two pipelines in the oilsands region of northeastern Alberta as producers defer their projects and big export pipelines like Keystone XL and Energy East face delays.
The Canadian Association of Petroleum Producers has estimated 35,000 jobs in the oil and gas industry have been shed so far this year.
In addition to its pipeline business, TransCanada has investments in nuclear, solar, wind and hydro electricity production.