Tullow Oil is said to be preparing to announce job cuts by the end of the first quarter as oil prices continue to fall.
It was reported that the company, which owns assets in the North Sea, is currently reviewing staffing levels.
Details of the cuts could be presented to the market next month.
Since last year shares in the company have fallen by 56% as the price of oil hits a six-year low.
A report by energy consultant Wood Mackenzie said oil prices averaging below $60 per barrel could results in the levels of upstream investment in the North Sea plummeting.
Erin Moffat, UK upstream senior research analyst for the Edinburgh firm, said: “At an oil price of $60/barrel, 95% of pre-sanction oil and gas reserves in the UK generate less than a 15% return on investment.
“This has intensified concerns over future UKCS (UK continental shelf) investment as further cuts or delays to projects are likely.
“A low oil price could also impact producing fields with high operating costs, with the potential for shut-ins.
“We estimate US$3.2billion (£2billion) of spend associated with pre-sanction projects could be at risk over the next two years as a result of current oil prices.
“Without this, UK upstream spend in 2016 would be around US$10billion (£6.3billion) – just over half of 2014 levels.”
Nearly one-third of the total UK spend last year, or £3.8billion, was associated with just five assets – Mariner, Schiehallion, Laggan, Clair and Golden Eagle.