Energy News understands the decision came about as some big contracts had expired and, with the downturn in the oil and gas sector, there wasn't enough work to justify the Melbourne branch remaining open.

However, the company still sees Australia as a long-term investment and the move was about consolidating so it can strike when the iron is hot when the market picks up.

RBC Capital Markets said this week that a supply gap should open up by 2019 in the oil market, thanks to the underinvestment stemming from the oil price fall that started in 2014.

Farstad CEO Karl-Johan Bakken said the company was consolidating all its activities into Perth, making it the headquarters and operations centre for Australia, where it has been involved since the 1990s.

The office base will also continue to run its training and offshore simulation centre in Bibra Lake in Perth's southern suburbs.

Bakken cited the challenging market situation and subsequent sharp reduction in offshore activity for the move, which will see Farstad cut its Australian staff from 65 to just 30.

"It is with regret that we have to lay off dedicated and highly skilled employees, but it is the unfortunate result of a necessary capacity adjustment," he said.

Bakken thank all of his employees who have "contributed in building up Farstad Shipping in Australia", describing the transfer of activity to Perth was a "necessary step in preparing Farstad Shipping for the future".

"In addition to working on establishing an overall refinancing plan, we are continuously working on structural solutions in order to secure our competitiveness and to align with the market and the needs of our clients," he said.

Farstad's Singapore unit, which has previously been reporting to Australia, will now be directly linked to the head office in the Norwegian sea port town of Aalesund.