Canadian Oil-Sands Operations Resume After Forest-Fire-Related Outage

By Chester Dawson And Judy McKinnon 

CALGARY-- Canadian Natural Resources Ltd. and Cenovus Energy Inc. said Thursday that oil-sands projects threatened by a wildfire have returned to normal operations after nearly two weeks offline.

Both major oil-sands producers' operations are located in Alberta's Cold Lake region, about 300 kilometers (186 miles) northeast of Alberta's capital, Edmonton. The blaze had shut in nearly 10% of Canada's oil-sands output, or about 233,000 barrels a day, since it was detected May 22.

Canadian Natural said full production has resumed at its 80,000-barrel-a-day Primrose site, which had been evacuated due to the closure of an access road, and its 25,000-barrel-a-day Kirby South operation, which had cut back output after the shutdown of a third-party pipeline.

Cenovus said operations have returned to normal at its nearby Foster Creek site, which has a capacity of 135,000 barrels a day and is jointly owned with ConocoPhillips. The Calgary-based company said it expects the 11-day shutdown to reduce second-quarter production by about 10,500 barrels a day and crimp annual production by about 2,600 barrels a day.

However, Cenovus said it still expects full-year Foster Creek production to meet earlier guidance of between 62,000 barrels and 68,000 barrels a day net to the company. First-quarter production there averaged about 68,000 barrels a day net, while Cenovus's overall first-quarter production totaled 218,020 barrels a day.

Cenovus said it is assessing the overall costs related to the shutdown. Canadian Natural didn't provide a cost estimate for the lost production.

The affected Canadian Natural and Cenovus production sites are located on the Cold Lake Air Weapons Range, a 7,208-square-mile restricted-access facility that straddles the Alberta-Saskatchewan border.

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