The head of Calgary-based Cenovus says more cuts are looming this month, even though the company — one of Canada's five largest oil producers — laid off 1,500 people in 2015.
Brian Ferguson, Cenovus president and chief executive officer, says the past 18 months have been an unprecedented business environment — the worst he's seen in 35 years in the business, especially when it comes to the impact on employees.
"In 2015, we reduced our staff by 1,500 people," Ferguson told Rosemary Barton of CBC's Power & Politics Wednesday.
"There will be some additional reductions, not nearly of that magnitude, which will be occurring later this month."
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Uncertainty over pipelines isn't helping
Ferguson adds the uncertainty around the future of pipelines isn't improving the landscape.
"The biggest challenge we've got is on the pricing side because we don't have access to tidewater. We are getting a significant discount on Canadian realized prices because we don't have access to global markets," Ferguson explained.
Ferguson said Cenovus is doing what it can to mitigate the situation.
"We took some big steps to really improve our balance sheet in 2015. We have got a net debt to capitalization of 16 per cent at the end of 2015 and over $4 billion in cash on the balance sheet," he said.
"Last year we dropped our operating costs about 25 per cent per unit. We are targeting another 10 to 15 per cent this year."
Ferguson supports Alberta's carbon tax in principle
Yet, despite the tough year, Ferguson says he is in favour of the Alberta government's plan to put a price on carbon, if applied broadly.
He said putting a price on carbon is a "balanced approach" if applied from production to consumption.
"This may sound counterintuitive coming from the CEO of an oil and gas company, but I am actually in favour of a broad-based carbon tax that goes across the full value chain, from production, transportation to consumption," Ferguson said.
"We are in favour of the policy announced in Edmonton by the premier last November because it is going to take the majority of proceeds from the carbon levy and direct those into the new technology and innovation that will be focused on reducing the emissions and if that is the objective, that I think, is a very balanced approached."
With files from CBC's Power & Politics