Production Halted at Athabasca Oil Sands Project

Several minor explosions at the Athabasca oil sands project early on Monday caused a halt in production just eight days after the C$5.7 billion development began operations. Only one worked sustained minor injuries according to Shell Canada. The extent of the damage after the "minor" blasts and subsequent fire at the Muskeg River mine north of Fort McMurray, Alberta, was not immediately known and Shell Canada said it did not know how long it would take to make repairs.

The Athabasca Oil Sands Project started pumping bitumen extracted from the mine's oil-laden sands on December 29, 2002. The crude flows via pipeline to Shell's Scotford refinery near Edmonton, Alberta, for processing into synthetic oil.

"It's too early to tell at this time either the cause or the effect on the start-up process," Shell Canada spokeswoman Patty Richards said. All employees were accounted for and only one required minor first aid after the blasts, which occurred shortly after midnight in the froth treatment unit, which processes diluted bitumen. The fire was extinguished after slightly more than two hours.

The project is Alberta's third major oil sands mining and synthetic crude production project, following those operated nearby by Syncrude Canada Ltd. and Suncor Energy Inc. The Athabasca project has a capacity of 155,000 barrels a day, although output was not nearly at that level yet because it is still in start-up mode, Richards said.

Shell Canada has a 60 percent stake in the project. Its partners are ChevronTexaco Corp. and Western Oil Sands Ltd. with 20 percent each.