Husky Energy president and CEO Rob Peabody addresses the company’s annual meeting in Calgary earlier this spring. File photo by THE CANADIAN PRESS

Husky Energy president and CEO Rob Peabody addresses the company’s annual meeting in Calgary earlier this spring. File photo by THE CANADIAN PRESS

Husky Energy confirms 370 job cuts as it trims 2020-21 spending by $500 million

CALGARY — About 370 jobs have been cut at Husky Energy Inc. this year with most of the reductions coming in a major round of layoffs in October, CEO Rob Peabody revealed on a conference call Monday to discuss the company’s guidance for 2020 and 2021.

The Calgary-based company had refused previously to say how many workers were affected by job cuts designed to better align its workforce with lower capital spending plans going forward.

“What we’re seeing is that (the reductions) will generate forward savings of about $70 million … per year,” said Peabody, adding the company will take a charge against earnings of $70 million in the fourth quarter to account for the cuts.

“We’re going to continue those efforts to capitalize on the fact we’ve created a more focused and a simpler company.”

In a regulatory filing earlier this year, Husky said it had 5,157 permanent employees at the end of 2018, little changed from the numbers at the end of 2016 and 2017.

Capital spending for 2020 and 2021 is being cut by $500 million compared with guidance released last spring due to what Husky called changing market conditions.

The budget for 2020 is to fall by about $100 million to between $3.2 billion and $3.4 billion, while the following year it will drop by an additional $400 million.

The savings next year will mainly come from lower spending on cold flow heavy oil projects in Western Canada but production will increase by about four per cent thanks to the startup of two thermal heavy oil projects near Lloydminster, Sask., that use steam to aid flow from wells.

Average upstream production is expected to be in the range of 295,000 to 310,000 barrels of oil equivalent per day for 2020.

That includes about 5,000 barrels of oil per day in the first half of the year expected to be interrupted by the Alberta government’s oil curtailment program and planned maintenance activities, Husky said.

Capital spending for 2020 will focus on the thermal projects, its Liuhua 29-1 offshore natural gas project in China and construction of the West White Rose Project in the Atlantic region, Husky said.

Production is expected to rise about about 10 per cent in 2021 as new projects come on stream.

Husky said it expects to spend about $500 million next year related to the ongoing rebuild of its Superior Refinery in Wisconsin, which was partly destroyed by a fire in April 2018.

On the call, Peabody said about US$150 million of the estimated total US$750 million cost of the Superior rebuilding project will go to enhanced safety and throughput measures that will not be covered by insurance, but the remainder is covered and is therefore not included in the capital budget.

Husky, which is controlled by Hong Kong billionaire Li Ka-Shing, is basing its capital plan on an oil price of US$55 per barrel of West Texas Intermediate for 2020 and US$60 in 2021.

Its shares were little changed on Monday, having dropped by about one per cent in early afternoon trading. They have fallen by more than 42 per cent in the past 12 months.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Hugh Danielson and Brayden Watts, of Red Deer are trying to spread the word about a new innovation for wheelchairs that they think will be especially helpful during the COVID-19 pandemic. (Photo courtesy of Brayden Watts)
Red Deer company lands exclusive patent rights to wheelchair extension

By some small miracle, Hugh Danielson and Brayden Watts stumbled upon a… Continue reading

A nurse gets a swab ready at a temporary COVID-19 test clinic in Montreal, on Friday, May 15, 2020. Health Canada has reversed course on home test kits for COVID-19, saying it will now review applications for such devices. THE CANADIAN PRESS/Paul Chiasson
Employee at Bethany CollegeSide in Red Deer tests positive for COVID-19

An employee at a Red Deer continuing care facility has tested positive… Continue reading

The Government of Alberta has identified 1,828 new cases and 15 new COVID-19-related deaths, which brings the provincial death toll to 590. (File photo)
Alberta identifies 1,828 new COVID-19 cases on Friday

Central zone has 1,251 active cases

Higher sales of cannabis helped Canadian farmers come out in the green. (Black Press Media File)
Drumheller RCMP lay charge for unlawfully distributing cannabis

A joint forces investigation involving the AGLC investigation team partnered with Drumheller… Continue reading

Three weapons have been seized and four people are facing charges following a police operation in central Alberta. (Photo contributed by RCMP)
RCMP, Lacombe Police seize loaded guns, arrest four people

Four people have been arrested and multiple prohibited firearms are off the… Continue reading

Dan Cochrane, senior pastor at CrossRoads Church. Contributed photo
CrossRoads Church closes its doors for two weeks after staff member tests positive for COVID-19

CrossRoads Church made the decision to cancel in-house services for two weeks… Continue reading

Homeowners Cora and Alec Dion pose in the basement of their home in Fort McMurray, Alta., on May 8, 2020. More than seven months ago, the Dions were forced to flee Fort McMurray for the second time in four years as a spring flood threatened their home. THE CANADIAN PRESS/Greg Halinda
Fort McMurray residents still cleaning, considering options after spring flooding

‘It’s worse than just having water, because it’s ice mixed in with the water’

Public Services and Procurement Minister Anita Anand responds to a question during a news conference in Ottawa, Monday, Oct. 26, 2020. Anand says as soon as she knows when the first dose of a COVID-19 vaccine will arrive on Canadian soil, she will share that information with the country. THE CANADIAN PRESS/Adrian Wyld
Negotiating contracts for vaccines in development needed flexibility: Anand

Health Canada officials are days, maybe even hours, away from approving the COVID-19 vaccine

Harley Hay
Hay’s Daze: Not used to seeing giraffe with a mask

My bad. Now there’s an expression that used to stick in my… Continue reading

Speaker of the House of Commons Anthony Rota rises in the House of Commons, Wednesday, May 13, 2020 in Ottawa. nbsp; THE CANADIAN PRESS/Adrian Wyld
Speaker Rota reflects on first year presiding over unprecedented virtual Parliament

‘It’s not what I signed up for but it is what it is’

In this file photo, a lotto Max ticket is shown in Toronto on Monday Feb. 26, 2018. (By THE CANADIAN PRESS)
No winning ticket for Friday night’s $17 million Lotto Max draw

TORONTO — No winning ticket was sold for the $17 million jackpot… Continue reading

Montreal Alouettes' Michael Sam is set to make his pro football debut as he warms up before the first half of a CFL game against the Ottawa Redblacks in Ottawa on Friday, Aug. 7, 2015. Sam became the first publicly gay player to be drafted in the NFL. He signed with the Montreal Alouettes after being released by St. Louis, but abruptly left after playing one game. THE CANADIAN PRESS/Justin Tang
Study finds Canada a “laggard” on homophobia in sports

Study finds Canada a “laggard” on homophobia in sports

Canada's Kadeisha Buchanan (3) and Mexico's Jacqueline Ovalle (11) battle for the ball during a CONCACAF women's Olympic qualifying soccer match Tuesday, Feb. 4, 2020, in Edinburg, Texas. THE CANADIAN PRESS/AP-Delcia Lopez
Lyon defender Kadeisha Buchanan named Canadian Women’s Player of the Year

Lyon defender Kadeisha Buchanan named Canadian Women’s Player of the Year

Winnipeg Blue Bombers' Andrew Harris celebrates his touchdown against the Hamilton Tiger-Cats during the first half of the 107th Grey Cup in Calgary, Alta., Sunday, Nov. 24, 2019. Running back Andrew Harris, who was instrumental in the Winnipeg Blue Bombers ending their Grey Cup drought in 2019, tops the CFL team's list of potential free agents. THE CANADIAN PRESS/Nathan Denette
Grey Cup MVP, top Canadian Harris among Winnipeg Blue Bombers potential free agents

Grey Cup MVP, top Canadian Harris among Winnipeg Blue Bombers potential free agents

Most Read