Suncor plans 1,500 layoffs this year

Canada's second-largest oil producer Suncor Energy has told employees that it plans to cut 1,500 jobs this year in one of its first major moves by its new CEO.

In a staff memo announcing the layoffs, Suncor also told employees it was seeking C $400 million, $297.64 million in cost savings, according to one of the sources. At the end of 2022, the company had 15,558 employees, not including contractors.

Suncor announced in November that it would reduce its contractor workforce in mining and upgrading business by 20 percent. Imperial Oil has also reduced the number of construction crews working at its Kearl oil sands site in northern Alberta as part of cost-saving measures this year.

Oil prices have dropped from a year ago, but producers are still recording big profits.

On Thursday, a media report in the Canadian Press said Suncor would eliminate the jobs by year-end to reduce expenses and improve its financial performance. The number of layoffs has not been decided, but it was uncertain in which part of the company would layoffs take place.

Suncor is always looking for opportunities to drive value and improve performance in our business, Suncor said in a statement.

Suncor CEO Rich Kruger said in his first call with analysts that he would look to reduce costs, improve efficiency and simplify operations.

Suncor has been under pressure from activist investor Elliott Investment Management, which owns about 3% of Suncor, over its operating and safety record, which has resulted in over a dozen fatalities at its sites since 2014. In a statement, Suncor said it reached an agreement with Elliott to appoint three new independent directors.

Suncor shares were up 2.9% at C $39.12 in Toronto.