Canada Wildfire Prompts New Evacuation of Oil-Sands Workers
May 17 2016 - 5:20AM
Dow Jones News
CALGARY, Alberta—Uncontrolled forest fires forced the evacuation
of some 8,000 oil-sands workers late Monday, nearly two weeks after
more than 80,000 other people fled blazes that destroyed part of a
nearby town in Western Canada's Alberta province.
The move threatens to further delay a restart of at least one
million barrels a day in oil-sands production sidelined by the
forest fires. Canadian oil sands production averaged 2.5 million
barrels a day last year, much of which was imported by the U.S. for
refining into petroleum products.
The mandatory evacuation order issued by the local municipal
government affects staff who remained or returned after major oil
sands operators in the area shut down their operations earlier this
month. That came after wildfires destroyed 2,400 houses and other
buildings in the town of Fort McMurray, a regional hub that has
been under an evacuation order for residents since May 3.
The latest order, which came at 11:30 p.m. local time on Monday,
is a setback for large oil-sands producers such as industry leader
Suncor Energy Inc., which had said last week that it was in the
process of planning to resume production at its oil sands sites.
Suncor has shut in production of 300,000 barrels of oil a day at
two mines and a pair of oil-sands well sites.
Authorities extended the evacuation zone from north of Fort
McMurray to just south of Fort MacKay, a smaller community located
about 34 miles away. It applies mainly to oil-sands sites and
nearby housing camps in remote boreal forests such as those run by
Suncor and its 350,000 barrel a day capacity oil sands mining
subsidiary, Syncrude.
Suncor said it was relocating workers in the area to camps
farther north that aren't part of the evacuation order.
Other sites impacted include oil-sands projects operated by
Marathon Oil Corp. and PetroChina unit Brion Energy, according to
the Regional Municipality of Wood Buffalo, which estimated at least
8,000 people would be subject to evacuation.
None of these oil-sands facilities have sustained damage from
the fires, but they have been affected by staffing issues stemming
from the evacuation of Fort McMurray's resident and logistics
issues preventing them from shipping heavy crude. Pipeline operator
Enbridge Inc. has reduced its oil-sands crude shipments by about
900,000 barrels a day, down from a capacity of 1.5 million barrels
a day.
Earlier Monday, Enbridge said it would widen a firebreak and
continue to spray down equipment at its Cheecham oil storage
terminal, a facility located about 43 miles southeast of Fort
McMurray.
The government of Alberta said the wildfire near Fort McMurray
had spread to more than 702,000 acres, or about 1,096 square miles,
due in part to hot, dry weather conditions. It has been burning out
of control since first being detected on May 1.
Write to Chester Dawson at chester.dawson@wsj.com
(END) Dow Jones Newswires
May 17, 2016 05:05 ET (09:05 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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