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Layoffs to hit 10K in Shell-BG Group merger
The Shell logo on pumps at a petrol station in London, Wednesday, Jan. 20, 2016. Royal Dutch Shell expects its fourth quarter profits to drop by at least 40 percent to between $1.6 billion and $1.9 billion after a sharp drop in crude oil prices, but underscored its determination to press ahead with the proposed mega-merger with BG Group plc. (AP Photo/Kirsty Wigglesworth)

Layoffs to hit 10K in Shell-BG Group merger

Royal Dutch Shell and BG Group will continue layoffs this year. The companies estimate a total of 10,000 employees and direct contractors will be let go, dating back to last year.

The cuts come as the companies slash operating costs and try to extract synergies from their upcoming merger.

In a preliminary four-quarter earnings report, Shell announced it reduced operating costs by $4 billion last year and expects to trim another $3 billion in costs this year.

According to Royal Dutch Shell CEO Ben van Beurden, Shell is taking steps to refocus and reduce capital spending. The company’s capital investment is projected to be $29 billion, or 20 percent less than 2014 levels. Shell plans to be more efficient and selective of new investments.

No other details were provided about its job cuts. The company announced approximately 7,500 layoffs in 2015.

Shell’s acquisition of BG Group is subject to shareholder approval, but is expected to close in the coming weeks. The transaction was originally valued at more than $70 billion, but the price fell as Shell’s shares declined with falling oil prices.

Shell’s fourth quarter and full year 2015 results are scheduled to be announced Feb. 4.

In related news, BP to cut 4,000 jobs amid oil price plunge.

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