Devon Energy Corp. said on April 10 it would lay off 300 workers, roughly 9% of staff, part of a plan to streamline operations and boost the shale oil producer’s sagging returns and stock price.
The cuts will affect all areas of the company’s operations, not just its Oklahoma City headquarters. Staff will be let go “in the weeks ahead,” Devon said in a statement.
Devon, like many of its shale peers, has come under pressure from Wall Street in recent months to focus less on production and more on ways to boost shareholder returns. The company’s stock had, as of Tuesday’s close, lost more than 20% of its value in the past year despite a jump in oil prices.
Devon said it expects the cuts to help save $150 million to $200 million annually by 2020. “The oil and gas industry is in a lower-for-longer commodity price environment, which requires Devon to transform the way it operates,” Devon spokesman John Porretto said in a statement.
Devon also laid off staff in 2016 as the oil industry grappled with oil prices nearly half of current levels.
CEO Dave Hager said last month that Devon had to shed assets of more than $5 billion to become a “lean, efficient company that drives high returns.”
Devon, which operates in several large U.S. shale fields, also said last month that it would buy back $1 billion of its stock and raise its quarterly dividend by 33% after posting lower-than-expected quarterly earnings.
Shares of Devon jumped 6.5% on the afternoon of April 10 to $33.50 a share on the New York Stock Exchange in line with broader markets and oil prices.