Outlook North of Fort McMurray Positive, Oil Sands Production Sites Resume

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Researched by Industrial Info Resources (Sugar Land, Texas)--With the threat of the Fort McMurray wildfire having moved away from oil sands sites north of the city, some producers have already begun to resume operations.

Eleven production companies and three oil pipeline operations halted their activities as a result of the blaze, with 1.07 million barrels of oil per day (BBL/d) of oil sands production taken offline as of late Sunday, according to the U.S. Department of Energy (DoE), which cited news reports.

The following companies have either begun restarting some aspects of their operations or have some facilities which have remained operational during the fire.

• Syncrude (Fort McMurray), a joint venture owned by seven partners, has restarted its power generator at its Aurora bitumen mine, according to the DoE. It has moved from emergency response to planning for the restart of its operations, but has not brought forth a timeline for restart activity.
• Royal Dutch Shell Plc's (RDSA) (The Hague, Netherlands) joint venture's (Albian Sands Energy Incorporated) Muskeg River Oil Sands Mine has restarted production at a reduced rate, the DoE said.
• Cenovus Energy Incorporated's (NYSE:CVE) (Calgary) Christina Lake oil sands facility has maintained full production since May 6.

In a news conference Tuesday, Alberta Premier Rachel Notley said that companies are expected to resume production in the days and few weeks ahead. She outlined steps that operators have identified to make the transition to restart go smoothly, such as ensuring infrastructure (pipelines and electricity) is operational; providing safe transportation of goods and workers by road and by air; providing necessary housing, including medical facilities; and resourcing regulatory agencies.

In the same news conference, the Suncor Energy (NYSE:SU) (Calgary) Chief Executive Officer Steve Williams expressed optimism in the ability for oil sands production sites to restart in as little as a few days or a week. He noted one of the company's biggest projects under construction in the area, Fort Hills, which employs 5,000 people, has all the logistical (housing, transportation) capabilities to come in and restart activity. However, Notley stressed safety before all else in restart planning, noting that operations will only restart when it is safe for both personnel and the environment.

Williams stated during a question-and-answer session at the conference that there were currently no planned layoffs of employees due to the fire. In fact, additional schemes have been developed to bring about funds to pay workers in advance. "I think employees are in very good shape," he said.

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