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    40% of Alberta Oil Sands Production Remains Offline

    According to a recent article in the Globe and Mail, it is unclear when the oil sands companies, who have taken over 1 million bbld of production offline due to the Fort McMurray wildfires, will be able to re-start production.

    Despite the wild fires sparing the oil sands facilities in northern Alberta, many of the largest operators have reduced operations or taken production offline to ensure the safety of their workers while the fires continue to burn nearby. Further, many oil patch workers have been displaced and critical supplies and services have been diverted to support emergency relief operations.

    FORT MCMURRAY, ALTA.: JUNE, 18, 2013: An aerial view Suncor's base plant oilsands upgrading facility next to their oilsands mining operations north of Fort McMurray, Alta. on June 18, 2013. The base plant separates bitumen from the nearly 500,000 tons of oilsands it receives per day and turns it into Synthetic crude. It also processes bitumen from Suncor's McKay River and Firebag steam assisted gravity drainage (SAGD) oilsands operations in the area. (Ryan Jackson / Edmonton Journal)
    Suncor Energy’s base plant oilsands upgrading facility and mining operations. (Ryan Jackson / Edmonton Journal)

    There was fear over the weekend that Suncor’s base mine and CNOOC Nexen’s Long Lake operations would be caught up in the blaze, but thanks to changing weather both facilities were not damaged. However, both facilities remain offline, as do Syncrude’s 350,000 bbld mine and processing plant and Husky Energy/BP PLC’s 40,000 bbld Sunrise facility.

    Once the danger of the fire has ceased, there is a lot of motivation for operators to start back up quickly, says Jackie Forrest with Arc Financial Corp. “They have a lot of fixed costs so they’re going to be motivated to get some revenue to pay for those costs that aren’t going away.”

    Forrest also says that the province will be eager to generate economic activity in the area, which has been suffering financially since before the wild fire crisis, and is now faced with the cost of rebuilding.

    With the fire raging on, there is no clear time frame for when it will be safe for workers to return to work and for Alberta’s oil sands operations to return to production at full capacity.

    To read the full story in the Globe and Mail, click here.



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