Canadian Oil Sands Halts Syncrude Production After Fire, Prices Spike
Aug 31 (Reuters) - Canadian Oil Sands Ltd, the biggest shareholder in the Syncrude oil sands project, said it halted crude oil production after a fire damaged equipment at its processing facility in northern Alberta on Saturday, causing traders to scramble to secure temporarily short supply.
The company said the main coker conversion units were not damaged and Syncrude continues to operate. However, it suspended synthetic crude oil production and is developing a recovery plan, Canadian Oil Sands said late on Sunday.
Synthetic crude for September delivery traded as strong as $2 a barrel below U.S. crude futures on Monday morning, according to Shorcan Energy brokers, up from a discount of about $4.60 a barrel last week.
The operator of Canada's largest synthetic crude project said on Saturday it was investigating the causes of an early morning fire at an upgrading plant.
The fire broke out a few hours after the province's energy regulator announced it was shutting in 95 pipelines operated by Nexen, one of the partners in the project, because of safety issues identified following a large oil-related spill in July.
Syncrude is a 326,000 barrel-per-day mining and upgrading project, where mined oil sands bitumen is upgraded into refinery-ready synthetic crude. It produced an average of 261,500 bpd this year to date, according to its website.
The operations are a joint venture of seven partners: Canadian Oil Sands Ltd, Suncor Energy Inc, Imperial Oil Ltd, Nippon Oil subsidiary Mocal Energy Ltd, Murphy Oil Corp, China's Sinopec , and CNOOC subsidiary Nexen.
(Reporting by Supriya Kurane in Bengaluru and Catherine Ngai in New York; editing by Gopakumar Warrier and James Dalgleish.)
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
Operates 2 Offshore Rigs
- Alberta Regulators Charge Nexen Energy Over 2015 Pipeline Spill (Jul 06)
- Cenovus Drops Most Ever as $13.3 Billion Deal Ramps Up Risks (Mar 30)
- UKCS Oil, Gas Extraction Drops 10% (Dec 08)
Company: Murphy Oil Corporation more info
- Exxon Mobil Bets on Brazil, Buys 10 Oil Blocks in Auction (Sep 28)
- Murphy Oil CEO: Now is the Time for Deepwater to Come Back (May 02)
- Pilot Energy Inks Deal to Acquire Murphy's Stake in Permit WA-481-P Off WA (Jul 27)
Company: Sinopec more info
- Report: Quarter Of Oil Refineries Risk Closure Under Climate Goals (Nov 02)
- Sources: China's Sinopec Mulls US Oil Projects Ahead Of Trump's Visit (Oct 31)
- Sinopec's Oil Refining Overcomes Continued Upstream Losses (Oct 30)
Company: Imperial Oil more info
- Canada's Imperial Oil Posts Unexpected 2Q Loss (Jul 28)
- Imperial Oil Profit Boosted By Asset-Sale Gain (Jan 31)
- Bulk of Canada's Oil Sands Plants Seen Up in Days to Weeks (May 11)
Company: Suncor Energy more info
- Suncor Says Makes Progress In Oil Sands Project Dispute With Total (Oct 26)
- Canadian Oil's High-Priced Run Set to End as Supply Surges (Oct 11)
- Suncor, Total Argue Over Cost Of Fort Hills Project (Jul 27)
Company: Nippon Oil Exploration more info
- Canadian Oil Sands Halts Syncrude Production After Fire, Prices Spike (Aug 31)
- Tap Updates Zola-1 Drilling in Carnarvon Basin (Dec 22)
- Iraq-Nippon Talks on Nassiriya Oil Field Deadlocked (Mar 01)
Company: Syncrude more info
- Fire Extinguished At Syncrude Oil Sands Plant In Alberta (Jul 10)
- Falling US Oil Output Not Enticing Enough For Wary Investors (Jul 11)
- Firefighters Protect Canada's Oil Sands Battling Intense Flames (May 24)