Suncor Says Ruptured Recycle Line Most Like Cause of Fire

Suncor Energy announced that a ruptured recycle line was most likely the cause of a January 4 fire that damaged one of the company's two oil sands upgraders.

Suncor's preliminary findings suggest a recycle line that filters heavy oil from the fractionator before rerouting it back through the tower ruptured and released hydrocarbon vapor, which ignited. The fractionator is a processing unit that separates crude oil products. The ruptured recycle line was not lined with stainless steel, which is used to prevent corrosion. It is likely that corrosion caused the line to rupture.

Suncor continues to investigate the incident and is taking steps to ensure stainless steel lining is appropriately applied in other parts of its operations. Assessments to date indicate the issue related to the January fire was an isolated case.

Repair work is under way and Suncor expects to return to full production capacity in the third quarter. During the repair period, production is expected to average about 110,000 barrels of oil per day, plus bitumen production from in-situ operations.

The timeline for recovery work is preliminary and subject to change. Further inspection of the damaged equipment will occur as the repairs progress. Any new information could modify the timetable for returning to full production.

To mitigate the impact of reduced production during the recovery period, Suncor plans to bring forward as many maintenance projects as possible, including all, or significant portions of, a maintenance shutdown previously planned for the fall. Suncor's capital spending plans for 2005, including work to increase oil sands production capacity to 260,000 barrels of oil per day by year end, have not changed.