Suncor expects to shed 1,000 more employees

CALGARY — Suncor Energy Inc. (TSX:SU) expects to cut its workforce by about 1,000 more employees as Canada’s largest energy company sells off some of its natural gas and international assets.

CALGARY — Suncor Energy Inc. (TSX:SU) expects to cut its workforce by about 1,000 more employees as Canada’s largest energy company sells off some of its natural gas and international assets.

Spokesman Brad Bellows said Tuesday that 1,000 is a “very round number,” and the company will have a firmer idea of precisely how many people will be leaving as the divestiture program continues throughout the year.

“I wouldn’t characterize these as layoffs,” Bellows said.

“The expectation in situations like this is that many jobs go with the asset to the new owner.”

Another 1,000 jobs, mostly at head office, were cut as part of the Petro-Canada merger, which closed in August. The company had later signalled its natural gas business in particular would be subject to “significant downsizing.”

Suncor plans to sell between $2 billion and $4 billion in non-core assets that it inherited through its merger with Petro-Canada last summer.

Since Suncor intends to remain an oilsands-focused player, that means natural gas assets in Canada and operations overseas are on the block.

Once Suncor pares some of its more peripheral holdings, it has said it expects to be roughly 70 per cent weighted toward oilsands and 30 per cent weighted toward everything else.

Earlier this month, Suncor said it had sold natural gas operations in Colorado to Houston-based Noble Energy Inc. (NYSE:NBL) for US$494 million.

In addition to the U.S. production, Suncor has signalled its intention to shed some of its smaller North Sea holdings and Trinidad and Tobago operations.

Chief executive Rick George said in November that big projects in Libya and Syria could be worth keeping, as would cash-flow generating offshore operations in Eastern Canada.

Last month, Suncor sold 98 of its retail gas stations to Husky Energy Inc. (TSX:HSE). Suncor was required to divest some of its downstream assets as one of the Competition Bureau’s conditions for allowing the company to merge with Petro-Canada.

In the oilsands, Suncor is pressing ahead with Phase 3 of its Firebag project near Fort McMurray, Alta., but has said the fate of the Fort Hills project would be decided further out into the future.

Bellows said Tuesday that Fort Hills, a proposed mining operation in which Petro-Canada used to be the lead partner, still remains very much on the back burner.

“We’re looking at what the options are for Fort Hills, the timing and how the overall project might be put together,” he said.

“We don’t expect to have a real decision until well into 2010, probably towards the end of the year.”

Suncor has a 60 per cent stake in Fort Hills with Vancouver miner Teck Resources Ltd. (TSX:TCK.B) and oilsands junior UTS Energy Corp. (TSX:UTS) evenly splitting the remaining stake.

Shares in Suncor closed down 71 cents at $37.87 on the Toronto Stock Exchange on Tuesday.