May 25, 2015 / 3:59 PM / 4 years ago

Wildfire shuts down about 9 percent of Alberta crude output

CALGARY, Alberta (Reuters) - A wildfire raging in northeastern Alberta has shut down around 233,000 barrels per day (bpd) of production at three oil sands projects and is expected to remain out of control for “some while yet,” a provincial government spokesman said on Monday.

Over the weekend, Cenovus Energy Inc (CVE.TO) and Canadian Natural Resources Ltd (CNQ.TO) evacuated staff and halted output at two sites as a precaution against the rapidly spreading forest fire.

On Monday, CNRL said it also cut production at its nearby Kirby South thermal project to 12,000 bpd from around 30,000 bpd.

In total, roughly 9 percent of Alberta’s crude output is offline as a result of the fire, with no clear indication of when production can resume.

The Alberta government’s wildlife information officer, Geoffrey Driscoll, said the fire, which started on Friday, has grown to more than 8,000 hectares and is still out of control.

“With the warm weather, it’s not going to be under control (on Monday) for sure, at least until we get some more firefighters and or we get some weather that helps cool down the area,” Driscoll said.

Cenovus evacuated about 1,800 workers and shut down production at its Foster Creek oil sands site, situated on the Cold Lake Air Weapons Range (CLAWR) about 25 kilometers (15.5 miles) north of the wildfire.

The project, a 50-50 joint venture with ConocoPhillips (COP.N), averages about 135,000 bpd.

“We continue to monitor the situation and we’re preparing to get back in there quickly to start up our operations whenever we get word that the situation is under control,” Cenovus spokesman Brett Harris said.

Harris said the full impact on Cenovus production would not be clear until the fire is under control, but the company estimated if the shutdown lasts five days and a gradual ramp-up starts after that, the impact would be about 5,000 bpd for the quarter.

CNRL evacuated personnel from its Primrose oil sands project due to the nearby fire and shut in about 80,000 bpd of crude production.

Neither project is directly threatened, but the fire has closed the only access road to the sites.

“Once safe access to the CLAWR is permitted, Canadian Natural will assess our operations and determine the next steps to return to full operations accordingly,” CNRL spokeswoman Julie Woo said.

Imperial Oil Ltd (IMO.TO) and Husky Energy (HSE.TO) also have oil sands projects in the Cold Lake region. Both producers said operations were unaffected but they were monitoring the situation closely.

Alberta’s oil sands contain the world’s third largest crude reserves and the province is the largest exporter of crude to the United States.

The government declared a province-wide fire ban on Monday after an unusually hot dry spring.

Editing by Leslie Adler and G Crosse

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