Wildfires deal blow to struggling oil industry
Big energy companies open doors to evacuees, cut production
Alberta’s oilsands operators cut production and threw open their doors to evacuees as uncontrolled wildfires forced all 80,000 residents of Fort McMurray out of their homes Tuesday night.
Most oilsands facilities are 30 to100 kilometres north of the city, out of the reach of the flames approaching from the southwest.
The company facilities are wellequipped to provide temporary shelter as they’re normally home to thousands of fly-in, fly-out workers from the Maritimes and other parts of the country.
Wednesday, the companies turned their work camps into temporary shelter for fleeing residents, sending non-essential workers from other parts of the country home in chartered aircraft from their own airstrips.
The fire has hampered efforts to get out of town, as thousands of trucks and cars clogged the only exit route, Hwy. 63. At one point, flames closed off the southern route to Edmonton, forcing some evacuees to turn around and head north to the oilfields.
Residents trying to fly out of Fort McMurray International Airport were out of luck Wednesday as the fires closed in on the facility, which lies southeast of town, forcing WestJet to cancel planned emergency flights.
Syncrude Canada Ltd. said it was hosting 2,000 people at its facility at Mildred Lake, about 40 kilometres north of Fort McMurray.
The company has cut back its operations to focus on supporting its employees and their families, spokesperson Will Gibson said in a telephone interview.
Shell Canada Ltd. opened its Albian Village work camp, 95 kilometres north of Fort McMurray, for any evacuated residents who need a place to stay, spokesperson Cameron Yost wrote in an email. The camp can accommodate up to 2,000 people.
Suncor Canada Ltd. said its plant, 25 kilometres north of Fort McMurray, is in a safe condition. “However, we are reducing production at our regional facilities in order to allow employees and their families to get to safety,” the company said in a post on its website.
Suncor said it is also working with the regional emergency response to help co-ordinate the evacuation efforts. Nexen said it’s working on a modified staffing plan to safely manage the situation, spokesperson Brittney Price wrote in an emailed statement.
The wildfires are the latest setback for an industry that has been struggling since the price of crude oil plunged from a peak of $100 (U.S.) a barrel in June 2014 to near $44 (U.S.) this week.
Canada’s oil and gas industry has cut at least 40,000 direct jobs in the last year and a half, and more layoffs are expected as the price of crude has been slow to bounce back.
Another 150,000 indirect jobs have been affected, industry groups estimate, as oil companies cut future production projects to reflect falling prices and demand.
It’s too early to say what impact this latest crisis will have on the oil industry’s production levels, a spokesperson for the Canadian Association of Petroleum Producers said.
Up until this week, Alberta’s largest evacuation had occurred in 2011 when 7,000 people were forced out of Slave Lake by wildfires that raged for nearly two days, destroying a third of the town.
Slave Lake is roughly halfway between Fort McMurray and Edmonton.
“I’ve lived here for 12 years. Fort McMurray is a very resilient community.” WILL GIBSON SYNCRUDE SPOKESMAN