Viru Keemia Grupp has laid off 35 people in May

VKG Source: Rene Kundla/ERR

Viru Keemia Grupp (VKG), an Estonian holding group of oil shale industry, has laid off 35 people in May as a result of the economic effects of the coronavirus pandemic and against the backdrop of reduced global oil prices.

VKG spokesperson Irina Bojenko said the employment contract of 27 persons were terminated last Friday: 18 people worked at the VKG Ojamaa mine, seven in VKG Oil and two in Viru RMT, one of the main activities of which is the production of metal structures.

Manufacturing optimisation at VKG is a consistent process that might lead to adjustments in the number of employees, Bojenko told ERR's online news in Estonian. "Collective redundancies are not envisaged in the near future," she however added.

VKG group currently employs more than 1,600 people.

In late March, fuel company Alexela Grupp announced it was laying off 93 people as a result of the economic effects of the coronavirus pandemic, 58 of those laid off worked at oil products producer Kiviõli Keemiatööstus.

"The economic situation in the oil shale sector has deteriorated sharply, and is sadly set to continue to deteriorate. With a heavy heart, I have been forced to downsize my team and implement austerity measures across the industry," Priit Orumaa, head of Kiviõli Keemiatööstus, then said.

The amount of employees has also been on a downward trend in Eesti Energia with major redundancies taking place last year. While 5,697 people worked at the company in the first quarter of 2019, the number of employees had dropped under 5,000 in the first quarter this year.

On May 7, the government approved providing special aid amounting to some €14 million to Ida-Viru County's oil shale sector.


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Editor: Anders Nõmm

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