CNRL says output at evacuated Alberta oil sands sites yet to resume

Tue Jun 2, 2015 12:10pm EDT
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By Scott Haggett and Nia Williams

CALGARY, Alberta (Reuters) - The threat of wildfires to oil sands projects in northeastern Alberta eased on Tuesday as two companies forced to evacuate staff from the region began checking equipment abandoned for more than a week, though production has not yet resumed.

Canadian Natural Resources Ltd said on Tuesday its staff are making safety checks at its Primrose and Kirby South oil sands projects in northeastern Alberta after they were evacuated when wildfires drew too close to the facilities.

The company said in a statement that it is preparing to return to normal operations at the site but offered no forecast for when production would resume.

Cenovus Energy Inc has also returned some workers to its 135,000 barrel per day Foster Creek oil sands project in order to return electrical power and inspect the facility.

Foster Creek is a 50-50 joint venture with ConocoPhillips, with production split evenly between the two companies.

"We are likely still days away from restarting production," Sonja Franklin, a spokeswoman for Cenovus, said in an email.

More than 233,000 barrels per day of oil sands crude production has been taken off line after companies with facilities close to uncontrolled wildfires rushed to evacuate staff. The Western Canadian province of Alberta is the major source of U.S. oil imports.

The production cuts have pushed up the price of Canada's benchmark crude. Western Canada Select for July delivery last traded at $7.00 below the price of West Texas Intermediate oil, the U.S. benchmark, the lowest in more than five years. That compares with a settlement price on Monday of $7.10 below WTI.   Continued...

Smoke rises from a wildfire north of Cold Lake, Alberta May 27, 2015 in a photo supplied by the Alberta Wildfire Info department. REUTERS/Alberta Environment and Sustainable Resource Development (ESRD)/handout via Reuters