Canada crude-Light synthetic strengthens to 5-month high

Tue Mar 5, 2013 3:52pm EST
 
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* April synthetic $6.75/bbl over WTI
    * Canadian Natural reports Horizon maintenance
    * April WCS quoted at $25.25 under WTI

    CALGARY, Alberta, March 5 (Reuters) - Canadian synthetic
crude prices jumped to a five-month high on Tuesday on word of a
further tightening in supplies from some of the largest oil
sands mining and processing plants, industry sources said.
    Light synthetic for April delivery was quoted at $6.75 a
barrel over the benchmark West Texas Intermediate contract, up
$1.15 from Monday's settlement, according to Shorcan Energy
Brokers. That was its highest premium since October 4.
    Canadian Natural Resources Ltd said it is
conducting routine maintenance at its 115,000 barrel a day
Horizon oil sands project in northern Alberta, but did not give
details of the work or the impact on production levels.
 
    The work is in advance of a planned 18-day maintenance
shutdown of the facility this spring, which is shaping up to be
a busy period for maintenance.
    Maintenance on a hydrogen plant at Suncor Energy Inc's
 Northern Alberta oil sands facility is set to start by
the end of this month, market sources said. The planned 14-week
shutdown will lower output from Upgrader 1, one of two plants
that convert mined bitumen into synthetic crude.
    The company also expects to start a full shutdown of
Upgrader 1 in the second quarter. Lasting seven weeks, the
maintenance will curtail the unit's 100,000 bpd of synthetic
output.
    Last week, Canadian Oil Sands Ltd, the largest
interest owner of Syncrude Canada Ltd joint venture, said
production fell 13.5 percent to 240,000 barrels a day in
February. That is down from capacity rates of about 350,000 bpd.
    Heavy crude prices also rose, and traders said they have
been surprised by the strength, which arose with little change
in fundamentals that include growing production and tight
pipeline capacity to move it to market.
    April Western Canada Select last sold for $25.25 a barrel
under WTI, compared with Monday's settlement of $26.30 under.