Chesapeake Energy laid off about 800 employees across the country today. Approximately 20 Pennsylvania employees were let go.
New CEO Doug Lawler took over earlier this year and has said financial discipline is his top priority for the Oklahoma City based company.
Lawler says this latest round of layoffs concludes the company’s restructuring.
“It has been a very difficult day. This has affected a significant number of Chesapeake employees,” Chesapeake CEO Doug Lawler told The Oklahoman Tuesday. “It’s been very difficult for us and for all those involved. It also is an essential step in making Chesapeake a competitive, productive, strong and vibrant company for decades to come.”
Tuesday’s announcement ends the monthslong changes that have led about 1,200 people to leave the company since the first of the year.
“The principle reason I came to Chesapeake was because of my confidence in the assets and my confidence in the people. I see great value in both,” Lawler said. “I also see great opportunity for a company that has been through a difficult transition, but has all the right resources essential to be an outstanding E&P (exploration and production) company.”
Chesapeake is the most active drilling company in Pennsylvania, most of its wells are in Bradford County.
Commissioner Doug McLinko (R- Bradford) says he’s concerned about the news of the latest layoffs. In August, Chesapeake let go of its community relations staff in the area.
“We’re a little worried what it’s going to look like,” McLinko says. “Since they’ve laid off all their public relations people, we’ve had absolutely zero contact with Chesapeake– none. It’s just been odd to say the least.”
Here’s the email Lawler sent to employees earlier today:
Dear Chesapeake Employees,
As I have previously shared, I joined Chesapeake Energy last June because of my confidence in the employees, the assets, and the company’s great potential. The unique combination of talent and resources within Chesapeake provides the foundation for what I believe can be a top-performing E&P company in North America.
The past few months have been very challenging as we have evaluated the competitiveness of the company. As we go forward and execute our strategies of 1) Financial Discipline and 2) Profitable & Efficient Growth from Captured Resources, we will position Chesapeake to be a sustainable, enduring enterprise, and provide the basis to achieve the leadership role in the E&P business that this company can deliver.
The organizational restructuring targeted to be complete by November 1 has concluded, and the initial transformation work is finished. By scaling E&P support services, reducing management layers, and aligning resources with a sharpened focus on accountability and efficiency, we have created a business built to deliver a sustainable and profitable future. As a result of the restructuring, approximately 800 employees – in various groups including Land, Operations, IT, HR, Legal, Facilities, A&D, Finance and Accounting – were informed today that they will be leaving the company.
We are grateful for the contributions of each employee impacted by the work force reduction. It was important to me that we took careful, diligent steps to evaluate our organization and to make sure each affected employee was treated with dignity and respect. In that regard, we offered eligible employees a severance package which included three months’ pay, 100% acceleration of equity, a lump sum COBRA payment, and outplacement services. This reduction in force completes the reorganization process I outlined in June.
I would like to extend a special thanks to the transformation teams that have worked tirelessly the past few months in evaluating all aspects of our business. More than 75 cross-functional leaders have dedicated significant time, energy and effort toward our goal of becoming a top-performing E&P company.
I am very excited about the future for Chesapeake, as we are a healthy, strong and resilient company that is poised to grow for decades to come. We will honor our core values and work diligently to execute our strategy. We are known for being a great place to work, and with your support and commitment, we will also be a great business and a great investment.
Please join me tomorrow for an all-employee Town Hall which will be webcast live and posted on MyCHK. If you are unable to attend in person, you can submit your questions to TownHallMeeting@chk.com.
Chief Executive Officer