Chevron Unit Will Eliminate 2,300 Workers : Energy: The domestic exploration and production arm is the hardest hit yet as Chevron restructures. More cuts are likely.

In its largest staff cutbacks specified so far, the domestic exploration and production unit of San Francisco-based Chevron Corp. announced Thursday that it will cut its work force by a total of 2,300 positions--28%--as part of a larger restructuring plan announced last January.

Chevron U.S.A. Production Co., the subsidiary, will also consolidate operations of its five current business units into three--headquartered in Houston, New Orleans and Bakersfield.

With Thursday’s job cuts, and 700 already announced at the oil giant’s Port Arthur, Tex., refinery, Chevron has gone 500 jobs beyond the earlier January estimate of 2,500 positions at risk in the current restructuring. And more cuts are likely to come as internal reviews of each operating unit continue, most notably among the company’s corporate staff.

“Every part of our company is trying to be a tough competitor,” Chevron spokesman Larry Shushan said Thursday, “and in today’s extremely difficult business environment, this is what’s required.”

Chevron, the nation’s fourth-largest oil company, has been hard-hit along with other big U.S. energy businesses by low prices for oil and natural gas. Chevron, troubled in virtually all sectors of its operations, has been shedding less productive assets--including hundreds of its U.S. oil fields--and restructuring its subsidiary companies, in part to cut back on personnel costs.

Chevron U.S.A. Production President Ray Galvin told employees by letter that when the reorganization is completed by September, the subsidiary’s work force will be 5,800, compared to the 8,100 now. Chevron Corp. employees in all divisions total 55,000 worldwide.

The production company will also relocate its 35 employees from San Francisco to Houston.

Shushan said he expected cuts among Bakersfield Chevron workers but couldn’t estimate how many of these would be layoffs.

Chevron is offering a special early retirement to 35,000 U.S. employees with more than two years of service. The company won’t know how many workers will leave voluntarily until after the May 15 closing date for that offer.

Today’s cuts are “the largest we expect” during the restructuring, Shushan said.