Brazilian oil giant Petrobras has approved a new organizational model, aiming to cut costs in the low oil price environment.
The company said that, as part of the initiative, it will cut at least 30% in management positions in non-operational areas. Petrobras has about 7,500 management positions approved, of which 5,300 in non-operational areas.
Petrobras said that he restructuring involves the merger of areas, centralization of activities, new criteria for the appointment of executive managers and the formal assignment of responsibility for results and decisions to managers.
The Exploration and Production Department will be organized by asset class, with structures created for Deep Water, Ultra-Deep Water, Onshore and Shallow Water. This will enable better management of value added by assets and optimization of oil and gas production.
The reduction of costs with these initiatives can reach R$ 1.8 billion per year, said the Rio based oil firm, which revealed that the cuts would be made in phases.
The first restructuring phase will involve eliminating 14 senior management functions. The number of departments will fall from seven to six through the merger of the Downstream and Gas & Electricity departments. The total number of management posts reporting directly to the Board of Directors, CEO and directors will be reduced from 54 to 41.
The second phase, planned for February, will cover the remaining management functions. Appointments and team allocations will begin in March, Petrobras added.