CALGARY -- An energy company with offices in Calgary and the United States has confirmed to CTV News that it is reducing positions in order to weather the precarious climate in the energy industry.
Ovintiv, which has three corporate offices in Calgary, Denver, Colo. and Woodlands, Texas, said the layoffs began earlier this week throughout the company.
A spokesperson for Ovintiv, which was formerly known as Encana until a corporate change in Nov. 2019, told CTV News should result in "right sizing the organization."
There is presently no information on how many workers will lose their jobs but it says the layoffs will occur in near equal percentages across all of its operations and locations.
During the first quarter, Ovintiv said it significantly reduced its activity, reducing the number of its rigs from 23 to seven.
This means future activity at the company will be significantly lower.
Energy companies take a credit hit
Ovintiv is among a number of oil and gas companies that have suffered strikes against their issuer ratings in the past few weeks.
DBRS Morningstar said in a release the company was downgraded to BBB (low) on June 8.
"While DBRS Morningstar expects the company to operate mostly within cash flow over the forecast period (2020–22), the negative trends reflect the dependence of the key credit metrics on higher commodity prices, especially in 2022, to support the current ratings," the company wrote.
It said the impact of the coronavirus, significant buildup of global inventories and the impact of production cuts by OPEC Plus all had to do with the change.
Cenovus Energy (BBB), Husky Energy (BBB) and Imperial Oil (AA) also all had their credit ratings recently lowered by DBRS.
(With files from BNN's Tara Weber)
