China oil company won’t cut frontline oil and gas workers

BEIJING: China National Petroleum Corp (CNPC) won’t cut frontline oil and gas workers as it seeks to reduce costs to cope with low energy prices, according to chairman Wang Yilin.

The country’s biggest oil and gas producer would create new opportunities for workers and was drafting development plans for a long-term low price environment, Wang said in an interview in Beijing yesterday.

The state-owned company was actively looking at overseas acquisitions and might boost investments in Russia and Iran, he said without elaborating.

“We are not like international oil companies where layoffs are the most convenient way to cut cost in the capitalist world,” Wang said. “We won’t have massive employees layoffs despite facing challenges from a low oil price.”

Wang’s comments contrast with plans for the countries coal and steel sectors, where China may lay off about 1.8 million workers as President Xi Jinping pushes to cut the country’s industrial overcapacity and reform state-run enterprises.

CNPC would cut capital spending this year by more than 20% and saw domestic crude production slipping as the company looked to shore up profit amid the energy downturn, Su Jun, general manager of the production and operation department at the company, said on Sunday.

It had a workforce of 1.4 million people, Wang said in February.

The country’s three biggest state-owned companies including CNPC unit PetroChina Co, China Petroleum & Chemical Corp and Cnooc Ltd all posted profit declines for the first nine months of 2015 as crude price crashed to a 12-year low. CNPC and PetroChina sold pipeline assets in November to raise cash to meet their annual profit target set by the state assets regulator. — Bloomberg