Energy Companies Cut Production Due to FiresMay 25, 2011 • By David Tsegai
Alberta Wild Fires
by Cameron Strandberg
Fires around Slave Lake threaten not only Alberta’s environment but also its economy. Oil companies cut their operations Monday, and on Tuesday, a few more companies followed suit.
Fires destroyed hundreds of homes, churches, and businesses and led to mandatory evacuation. CBA news announced that, although the CNQ site itself is not believed to be under threat, power has been cut to the surrounding area, which means a nearby pipeline can’t take the facility’s output away.
”If the pipeline doesn’t start up in the next day or so, oil production will have to stop altogether,” CEO Steve Laut said Tuesday. In that case, Alberta will lose production of 40,000 barrels per day.
Penn West Petroleum said it has shut down about 25,000 barrels a day of heavy oil and stopped drilling in the region. Canadian National Railway also announced it had halted operations in the area around Slave Lake.
Exall Energy Corp. has also shut down production of 921 barrels of oil per day. “Aerial surveillance of the Marten Mountain area indicates that Exall’s facilities and operations have not currently been impacted by the fires and are not at this time under threat from the fires,” the company said in a release. “The fires currently appear to be south and east of Exall’s Marten Mountain operations.”
CBA news added that Cenovus Energy would also like to stop its production of 22,000 barrels of oil per day, but is unable to transport oil because of the closure on Sunday of the southern leg of the Plains All American pipeline from a terminal northwest of Slave Lake.
At present, we can only guess as to how heavy an impact the fires will have. Alberta’s economy is strong and can recover quickly, but it won’t give homes back to the people who have lost them.