CALGARY, Alta. — The Mullen Group Income Fund announced it will be initiating temporary lay-offs at several of its wholly-owned business units due to the uncertainty relating to oil and natural gas drilling activity in Western Canada.
“The number of drilling rigs working in Alberta continues to decline which is having a direct impact on several of our oilfield service business units, stated Murray Mullen, chairman and CEO of the fund. Natural gas drilling activity has been in decline for the past year due to lower natural gas prices which is quite typical for a cyclical industry. However, many of our oil and gas customers have made it clear that they intend on reducing their capital investments in Alberta if the recently announced oil and gas royalty proposal, known as “Our Fair Share” is implemented.
Mullen also noted, since the Sept. 18 announcement of Albertas royalty review, the demand for services from Mullen Group companies has declined.
“There is no doubt that if the royalty changes proposed are implemented by the Province of Alberta the oil and gas service industry, and the hard working employees that generate their livelihood from the industry, will bear an unfair burden of these changes, said Mullen. Today we have announced that up to 100 of our employees will be given temporary lay-off notices. This is a very unpleasant part of my job but the fact is that investment in the Alberta oil and natural gas drilling industry is already being curtailed.
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