Monday, September 7, 2015

News: Darron hit by oil and gas downturn

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The Rotherham facility of Darron SBO looks set to close as part of restructure plans set out by the Schoeller-Bleckmann Group.

The precision machining specialist operates a Canklow facility with modern machine tools and state of the art manufacturing capabilities supplying a range of high quality components to the oil and gas industries.

The Austrian-based Schoeller-Bleckmann Oilfield Equipment AG (SBO) and the entire oilfield service industry was hit by the expected slump of drilling activity in the first half of 2015. Low global oil prices has led to declining global drilling activity.

The company launched "initial corrective measures" last year, reviewing operations, reducing expenditure on plant, property and equipment and reducing the number of staff.

As part of this, SBO has decided to merge two UK subsidiaries, moving activity from Darron's site in Rotherham to Techman Engineering's site in Chesterfield.

In a statement, the company said: "Customer restraint in ordering went hand in hand with persistent pressure on prices. SBO started at an early point to take a set of measures to counter this tendency, but they could not fully absorb the effects of the downturn.

"SBO initiated a programme in the third quarter of 2014 to streamline cost structures of its UK activities. In view of the current business environment it was decided to merge operational activities of the two neighbouring subsidiaries "Techman Engineering Ltd" and "Darron Tool & Engineering Ltd" at the location of Techman. As a result, structural and sustainable cost benefits will be created after the programme has been completed.

"Restructuring is running according to plan and should be finished in 2015."

The headcount at SBO, which has operations worldwide, was 1,279 in June, down from 1,720 in December.

Darron Tool & Engineering (Sheffield) Ltd was founded in 1969 and became part of the Schoeller-Bleckmann Group in 2000.

Darron SBO website

Images: Darron SBO

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