Repair crews assess damage to wildfire-hit Canadian energy boomtown

[FORT MCMURRAY, Alberta] Repair crews on Tuesday assessed wildfire damage to Fort McMurray after an initial inspection by officials showed the Canadian energy boomtown was spared the worst as nearby oil sands companies looked to resume production.

But the blaze that began on May 1 continued to burn through the province of Alberta, engulfing 229,000 hectares (560,000 acres) of land after it spread east to connect with another fire burning near Campbell Lake, some 50 kilometers (30 miles) east of Fort McMurray, whose 88,000 residents were evacuated.

Fort McMurray is the center of Canada's oil sands region. About half of its crude output, or 1 million barrels per day, has been taken offline, according to a Reuters estimate.

The fire's growth was not likely to trigger further evacuations, Travis Fairweather, an Alberta wildlife information officer said on Tuesday.

Cool weather, with overnight temperatures dropping below zero degrees Celsius (32F) helped firefighters contain the blaze, though forecasts from Environment Canada showed rain was unlikely in the coming days.

The fire's massive size has prompted some officials to say that rain would be necessary to fully extinguish it, as much of Alberta is tinder-box dry after a mild winter and warm spring.

Political leaders got their first glimpse of the state of Fort McMurray on Monday. Alberta Premier Rachel Notley said she was encouraged by how much of it escaped destruction, estimating almost 90 per cent of its buildings were saved.

The inspection also revealed scenes of utter devastation, with blocks of homes reduced to blackened foundations, front steps and metal barbecues.

Ms Notley said 2,400 structures had burned within the city while almost 25,000 were saved.

Officials warned it was not safe for residents to return, with parts still smoldering and large areas without power, water and gas. Ms Notley said repair crews will need weeks to make the city safe.

About 250 workers with utility company ATCO were in Fort McMurray working to restore gas and electricity, Ms Notley said.

Insurance experts on Monday revised sharply downward their estimates of the cost of damage from the blaze.

Oil sands companies, which have high fixed costs, will try to work quickly to resume production, but face the challenge of many staff and suppliers being displaced by the evacuation.

US crude oil futures were up 1.6 per cent on Tuesday, partly on concerns over disrupted Canadian production.

Royal Dutch Shell Plc has restarted production at a reduced rate at its Albian oil sands mining operation in Alberta, adding it plans to fly staff in and out.

But Imperial Oil Ltd on Monday completed a controlled shutdown of its Kearl oil sands mining project, adding it would remain shut until the company had fully grasped the logistics of getting people and materials to and from the site.

REUTERS