ARROW Energy has confirmed it has carried out a review of staffing levels but there's still no word on how many jobs will eventually be lost.
It's believed staff cuts have been underway for months as the company's owner Royal Dutch Shell tries to cut costs in Australia.
The Australian reports about 250 jobs are believed to have been cut on Monday.
The staff cuts come with the news Shell has sold its stake in the Wheatstone LNG project in Western Australia for $1.3bn.
The future of Arrow's proposed LNG plant on Gladstone's Curtis Island remains in doubt, with one Arrow staffer who was made redundant saying the project would not go ahead in its current form.
"(Senior management) are the only ones still pretending that LNG is still an option. Everyone else has already written it off," the staffer said.
The staffer said the best hope for the Arrow project would involve selling the gas from its position in the Surat Basin into the three more advanced LNG projects, and eventually revisiting a smaller LNG development based on the Bowen Basin gas reserves.
The Arrow LNG project had long been shaping as a key target of any spending cuts, with Shell and PetroChina yet to make a final investment decision on a project that was already facing cost pressures on several fronts.
Arrow on Monday confirmed it had carried out "a review of staffing levels as it manages costs".
Brisbane Times reports the statement came amid reports that managers in Arrow were travelling to regional centres in Moranbah and Dalby to kick off the job reductions.
Shell has signalled that it is considering several options for Arrow LNG, including a potential merger of the venture with one of the other projects in Queensland.
Last month a spokesman for Arrow Energy said the Gladstone project was not "schedule driven".
"Arrow is focused on building more value into the Arrow LNG project proposal," he said.
"As part of our drive to find more value and cost efficiencies in the current high cost environment, we need to be prudent about our current expenditure.
"Final investment, timing and collaboration are matters for Arrow's shareholders."