(Adds details on shut crude processing units, comment from
By Ethan Lou and Nia Williams
CALGARY, Alberta, March 15 Several crude bitumen
processing upgrader units at Syncrude Canada's oil sands plant
in Alberta were shut or running at minimized rates on Wednesday
as a fire continued to burn for a second day, the company said.
Mining and extraction of bitumen at Syncrude's Mildred Lake
and Aurora sites are also being paced to balance the resulting
lower demand, the company said in a statement.
Syncrude spokesman Will Gibson said the fire at the site in
northern Alberta had been "isolated and controlled."
Syncrude, Canada's largest single source of synthetic crude,
is majority-owned by Suncor Energy Inc, while Imperial
Oil Ltd provides operational, technical and business
Suncor said parts of the 350,000 barrel-per-day Mildred Lake
upgrading facility, which makes the tar-like bitumen less
viscous, were running at minimum rates, but neither it nor
Syncrude specified the capacity.
Synthetic crude prices had jumped on uncertainty over the
Two trading sources said they had been issued notice by one
of Syncrude's owners that there could be volume cuts as a result
of the fire but the impact and duration were being determined.
Syncrude said it planned a damage assessment and would begin
repairs once it was safe. It has not given any estimate of the
expected impact on crude output.
Gibson said Syncrude fire crews monitoring the blaze had
decided to allow it to continue to burn to consume residual
"This is the safest approach ... we have reduced the fire
load considerably," Gibson said.
Syncrude said on Twitter late on Wednesday, "All Syncrude
employees are asked to report to work as normal beginning with
nightshift this evening."
The fire broke out on Tuesday afternoon after a line failure
caused a treated naphtha leak, Syncrude said, adding that the
remainder of the operation was safe and stable.
The local detachment of the Royal Canadian Mounted Police
said the incident was not a "criminal event," but that it was
assisting the province's labor department in investigations.
Synthetic crude prices soared to a nine-month high of $2 a
barrel over the West Texas Intermediate benchmark, according to
Shorcan Energy brokers, after the premium had jumped to 80 cents
at settlement on Tuesday.
Syncrude already had a turnaround scheduled to run from late
April until June and some traders in Canada's oil capital
Calgary questioned whether that could be moved forward.
"Judging by the strength of synthetic crude prices the
market is of the mind production will be curtailed for some
time, whether that be non-voluntary or intentional," said RBC
Capital Markets analyst Mike Tran. "Syncrude could potentially
fast-forward the timing of upcoming planned maintenance."
An explosion rocked the Mildred Lake facility Tuesday
afternoon, prompting an evacuation, employees said. The facility
is about 40 km (25 miles) north of the oil sands hub of Fort
One worker injured in the fire was in hospital in serious
but stable condition, according to Alberta Health Services.
"Yesterday was a tough day for our organization and
especially difficult for one employee and his family," Syncrude
Chief Executive Mark Ward said in a statement.
(Additional reporting by Catherine Ngai in New York; Editing by
James Dalgleish, Toni Reinhold)