CNRL, Cenovus wait to resume oil production lost to wildfires

Thu Jun 4, 2015 5:18pm EDT
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By Scott Haggett and Nia Williams

CALGARY, Alberta, June 4 (Reuters) - Production at two of Canada's major oil sands operations remained suspended on Thursday as wildfires continue to rage in northern Alberta.

Cenovus Energy Inc's 135,000 barrel per day Foster Creek oil sands project and Canadian Natural Resources Ltd's 80,000 bpd Primrose site have been shut for a week after staff were evacuated when a wildfire threatened the two sites.

The Burnt Lake Fire in northeastern Alberta has consumed more than 33,000 hectares (127 square miles) of forest and remains out of control even as 300 firefighters struggle to contain the blaze.

The fire shut in about 10 percent of total production from the oil sands, the largest source of U.S. oil imports, and pushed the differential between Canada's Western Canada Select crude and the U.S. standard, West Texas Intermediate, to the narrowest in more than five years.

While the fire remains a threat and fire hazard in the region remains listed as very high, officials have allowed both companies to return some staff to their sites to prepare for normal operations.

Canadian Natural, the country's largest independent oil producer, has already resumed some production. The Kirby South project had suspended about 18,000 bpd of production after a third-party pipeline shutdown. That site began ramping up on Wednesday.

The company said on Thursday it has begun a staged start-up at the larger Primrose project, but cannot yet say when it will reach full capacity.

Cenovus has also returned some staff to Foster Creek, co-owned with ConocoPhillips. Cenovus said the restart is going well and it expects production to resume soon, though it has yet to announce a target.   Continued...