Consol Energy Inc. on Tuesday confirmed its second round of layoffs since the beginning of the year, again citing depressed commodity prices as an impetus for its decision to this time cut 470 jobs in its natural gas and coal divisions.
Tuesday’s announcement comes in addition to a move earlier this year to lay off more than 160 workers in its gas division, CNX Gas Co., a company spokesman said (seeShale Daily, April 10).
“We continually evaluate our workforce based on current and anticipated activity levels,” said spokesman Brian Aiello. “These are very difficult but prudent decisions given the depressed nature of commodity prices. We are taking aggressive action so that Consol can continue to operate from a position of strength through the downturn and quickly capitalize on the up-cycle when it returns.”
Once a traditional coal producer, Consol has been focused on growing its gas division, with its assets in the Marcellus and Utica shales increasing in recent years as retrenchment in its coal operations has led to thousands of job cuts over the last decade on that side of the business. The company’s core gas operations are in Ohio, West Virginia and Pennsylvania, where it produced 235.7 Bcfe of natural gas last year, a 37% increase from 2013 (see Shale Daily, Jan. 30). That was followed by a record-setting first quarter in which the company produced 71.6 Bcfe (see Shale Daily, April 28).
The company confirmed that it would lay off 290 employees working in administrative positions and in its gas division. Another 180 jobs would be cut in its coal division, Consol said. Combined, the layoffs account for about 10% of the company’s workforce. At the beginning of the year, Consol said it would cut its capital budget by $80 million from 2014 spending of $1 billion.
Consol has taken other general and administrative cost-cutting measures as well this year, announcing in June that it would accelerate a plan announced last year to stop paying health benefits for more than 4,000 retirees.