‘Ottawa’ Fort McMurray Fires Spread Toward Oilsands Sites as Rain Forecast
Wildfires raging through Alberta have spread toward the main oil-sands facilities north of Fort McMurray, knocking out an estimated 1 million barrels of production from Canada’s energy hub. A cold front scheduled to pass through the area Sunday may bring light rain that would help fire fighters battle the inferno.
The blaze, which was forecast to expand to more than 2,500 square kilometres (965 square miles) in the next few days, grew slower than expected and now covers about 1,600 square kilometres, Alberta Premier Rachel Notley said at a news conference on Sunday. While the fire approached a Suncor Energy Inc. site, there was no damage as firefighters are holding the blaze southwest of the area. Cnooc Ltd.’s Nexen operations to the south of Fort McMurray have suffered “minor” damage, said Chad Morrison, a wildfire manager for the Alberta government.
A cold front may bring a “bit of rain,” but will be preceded by winds of up to 60 kilometres an hour (37 miles an hour), spreading the fire further, Travis Fairweather, a forestry spokesman, said earlier. While cooler temperatures present responders with a “great opportunity” over the next three to four days, fires deep into the forest will likely last for months, Morrison said. The blazes are being blown east and are 30 to 40 kilometres (19 to 25 miles) from the border with Saskatchewan, Morrison said. The fire that began a week ago probably had a human cause, though that remains unknown, he said.
“This beast is an extraordinarily difficult problem,” federal Public Safety Minister Ralph Goodale told reporters Sunday. “Because of the weather in the last few hours and the weather forecast going forward, it would appear that the situation is moderating, perhaps a bit.”
Disruptions to oil production, the lifeblood of Alberta’s economy, add to a human catastrophe as blazes razed entire neighborhoods in Fort McMurray, the gateway to the world’s third-largest crude reserves. All of the 25,000 people who had gone north to flee the fire have been evacuated south and the majority of them are in Edmonton, Notley said.
The wildfires that may soon cover an area the size of Luxembourg have led to combined productions cuts of about 40 percent of the region’s output of 2.5 million barrels, based on IHS Energy estimates. The cuts, and the mass exodus of more than 80,000 people from Fort McMurray, represent another blow to an economy already mired in recession from the oil price collapse.
Syncrude Canada, a joint venture controlled by Suncor, shut down its Aurora mine and Mildred Lake operation about 40 kilometres north of the city and has evacuated about 1,200 workers. Syncrude has a capacity for 350,000 barrels of oil a day. Morrison said the oil facilities are highly resistant to fire with their buffer zones.
Smoke reached Syncrude’s Mildred Lake site Saturday, company spokesman Leithan Slade said in an e-mailed statement. “We will bring operations back online only when it is safe to do so.”
Suncor, Canada’s biggest energy company, Phillips 66 and Statoil ASA have declared force majeure — a provision protecting companies from liability for contracts that go unfulfilled for reasons beyond their control — on supplies from the region. Husky Energy Inc. said Sunday it has completely shut its Sunrise facility, which has a capacity of 60,000 barrels a day and was producing about half that before the blaze began. Nexen’s operation, with a capacity of 92,000 barrels a day, was shut.
The inferno around Fort McMurray may become the costliest catastrophe in the country’s history with insurance losses potentially reaching C$9.4 billion ($7.3 billion). Bank of Montreal cut its second-quarter gross domestic product growth estimate to zero from 1.5 percent, citing “severe disruptions to oil production” due to the fires. BMO said the estimate was a placeholder, dependent on receiving more information on the scope of the disaster.