Devon Energy Corp cut its dividend and its capital spending by 75% Tuesday. The company said it would lay off up to 20% of its current staff as the low prices of oil roil companies in the shale oil business.
The company, based in Oklahoma City, is a top independent U.S. oil producer. It said on Tuesday it would lay off 1,000 of its staff and another 600 workers would leave later in the year in divestitures.
This move by Devon marks the most recent in a series of announcements made by oil companies in the U.S. responding to the crude prices that have dropped below $30 per barrel but cutting spending more, lowering dividends or producing fewer barrels.
Devon lowered its dividend for its 2016 second quarter to 6 cents from its prevision one of 24 cents per share.
Dave Hager the CEO of the company said in a prepared statement that the company believes its decision to adjust the dividend is one that is prudent given the commodity prices and the uncertain length of the oil price downturn.
Exploration as well as production spending will range between $900 million and $1.1 billion in 2016, which is a steep reduction from 2015.
Due to less output of natural gas, it also announced that the output in 2016 would be 6% less than the overall net production from its core assets of over 571,000 barrels a day of oil equivalent in the fourth quarter.
The company said as well that executive vice president Tony Vaughn of exploration and productions has been promoted to the COO.
Devon reported a $4.5 billion net loss for its 2015 fourth quarter, which was wider than a $408 million net loss in the same period one year ago.
On adjusted terms, the company had 77 cents per share in earnings, which beat the expectations of analysts of 70 cents per share.