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Drilling company Maersk cuts staff

Company said reaction is necessary in low oil price era.

By Daniel J. Graeber

COPENHAGEN, Denmark, Feb. 5 (UPI) -- It would be "irresponsible" not to react to the low oil price climate and keep staffing levels in place, Danish oilfield services company Maersk Drilling said.

Lead energy companies, from BP to Royal Dutch Shell, have announced plans to cut capital spending in 2015 as oil prices continue trading in a bear market. Though rising in recent days, the price of crude oil is about 50 percent less than June highs of about $100 per barrel.

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Maersk Drilling said market conditions meant there was a lower demand for offshore rigs, which meant it was forced to cut 90 positions from its head office.

Chief Executive Officer Claus Hemmingsen said staff reductions were part of the effort to cut costs and improve corporate efficiency.

"It is regrettable that we have to scale down the head office, however, under the current market conditions it will be irresponsible not to act," he said in a Wednesday statement.

In August, the company laid off about 50 employees at its Houston office and reassigned eight others to its headquarters in Copenhagen because of what it said were operational challenges involved with working in the deep waters of the Gulf of Mexico.

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In July, Maersk said was taking a $1.7 billion impairment on its assets in Brazil and leave the country behind despite what it said was "significant" potential for oil development.

The company last year said it's trying to breathe new life into an industry working with a fleet of offshore rigs in need of replacement.

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