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Fort McMurray fire contained, but smoke delays oil production restart

Firefighters have contained a massive wildfire in Canada's oil sands region, but thick smoke Friday continued to prevent a resumption of most oil production.

[OTTAWA] Firefighters have contained a massive wildfire in Canada's oil sands region, but thick smoke Friday continued to prevent a resumption of most oil production.

The fires, which forced the evacuation of 100,000 residents of Fort McMurray and oil facilities to the north, interrupted extraction and refining of an estimated 1.2 million barrels of oil per day.

The Canadian cutbacks have sent crude prices climbing towards the US$50 mark, by helping to reduce a global supply glut.

In the past week the blaze has doubled in size, growing to more than 500,000 hectares (1.2 million acres).

Officials told a press conference it is now in check and firefighters are confident they can hold it over the coming days, until it rains.

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Before oil production can resume, however, the smoke must clear.

The two largest facilities, operated by Suncor and Syncrude, remain shuttered.

"They remain under mandatory evacuation," said Shane Schreiber, head of the Alberta Emergency Management Agency.

"I can't see that being lifted until the air quality index becomes stable and until we get a couple more days of getting good firefighting done on that fire," he said.

Air pollution caused by the smoke has fallen but remains high after recently peaking at more than three times safe levels at the height of the emergency.

Bitumen processing at Suncor's base plant and production at its MacKay River facility were suspended after a total of 8,000 workers in the north were ordered out Monday as the fire spread and intensified, destroying a 665-room lodge.

Syncrude's Mildred Lake and Aurora oil sands sites were also evacuated.

Imperial Oil, meanwhile, said in a statement that it has resumed limited operations at its Kearl oil sands site, 70 kilometers (44 miles) north of Fort McMurray.

The bitumen mine is jointly owned by Exxon Mobil (29 per cent) and was producing nearly 200,000 barrels per day before the fires struck.

"We continue to have firefighters deployed closely around the oil sands operations and industrial camps," Alberta wildfire manager Chad Morrison said.

"The fire will take some time to put out, but we feel that given the current conditions and the number of firefighters we have there, there is no immediate threat (to the facilities)."

"Hopefully this weekend we'll see some much needed precipitation, but until then firefighters continue to dig in and hold the line around the community (of Fort McMurray) and protect critical infrastructure."

A trace amount of rain fell on Fort McMurray and its surroundings on Thursday. Heavier rains are forecast for the next three days.

"Long term we're very optimistic, we continue to make very good progress there and everything continues to be well contained," Mr Morrison said.

There are currently 1,100 firefighters battling the blaze. Mr Morrison said the province hopes to bring in another 500 next week, and 500 more the following week.

Cost estimates, meanwhile, predict the loss to the Canadian economy due to the temporary oil sands production shutdown could reach 0.5 per cent of gross domestic product.

The oil sector accounts for four per cent of Canada's GDP.


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