Doyon Drilling files notice that 304 workers will be laid off due to COVID-19
An Alaska oil service company will temporarily lay off 304 workers due to the COVID-19 pandemic.
Doyon Drilling provides rigs and services for ConocoPhillips. The company, a subsidiary of Doyon Limited, filed a notice with the Alaska Department of Labor on Friday that it will need to temporarily lay off 304 employees.
“This action is anticipated to be permanent until the crisis is over and the industry recovers,” wrote Ron Willson, Doyon Drilling’s president and general manager.
The laid off employees include 65 floorhands, 34 roustabouts and 19 drillers.
announced that it was making another $200 million spending cut in Alaska. The Houston-based oil company had earlier told Doyon Drilling to demobilize its rigs.
Friday’s announcement from Doyon Drilling follows similar notices from
Those four companies announced that roughly 300 employees would be laid off.
Rebecca Logan, the CEO of the Alaska Support Industry Alliance, said the worst is yet to come for the oilfield service industry. “That’s a trend that’s just going to gain speed in the near future,” she said.
The oil industry has been hit particularly hard by the coronavirus pandemic, due in part to historically low oil prices and a global oversupply in oil.
“Speaking from the perspective of our industry, everyone is in trouble,” Logan said.
To make matters worse, few Alaska-based oilfield service companies have received federal coronavirus assistance. Logan said of 180 Alaska companies directly supporting the oil and gas industry, only five have received federal loans.
Many companies surveyed by the ASIA said they’d need financial assistance in the next three or four weeks or more employees will be let go. “And, what we’re seeing from the federal government just isn’t making an impact,” Logan said.
The oil industry was expected to be a bright spot in the Alaska economy in 2020 with companies expanding drilling and exploration on the North Slope. Now, those gains are expected to be wiped out.
“The oil industry losses are probably going to be going on for quite a while,” said Neal Fried, an economist with the Department of Labor.
Around 5,000 jobs were lost from the oil industry in recent years but the industry rebounded, recovering 1,000 jobs in the past year. “It was a modest recovery,” Fried said.
Ending coronavirus restrictions likely won’t see the oil industry recover immediately. The oil glut and low oil prices will likely continue, hampering how many people get rehired.
“It could be 18 months to two years before that turns around,” Logan said.