Oil firms devise plans to restart output in wake of Alberta wildfire

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Major oil sands producers are devising plans to restart more than one million barrels a day of production that has been shut off due to the northern Alberta wildfires, after authorities lifted evacuation orders affecting about 8,000 workers.

The regional government late Friday cleared seven work camps north of fire-ravaged Fort McMurray to reopen.

They were evacuated early last week when the threat from the blaze, which was thought to have eased, returned, along with thick, heavy smoke.

That stalled the resumption of oil production that had been off-line or sharply reduced in the days after the fire first raged into the city of Fort McMurray, forcing more than 80,000 people to flee. The city remains evacuated, with residents due to start re-entering neighbourhoods on June 1.

On Sunday, the operator of one of the largest work camps north of Fort McMurray inspected the facility before workers could return. Noralta Lodge's Fort McMurray Village, which can house more than 3,000 people, was in danger last week of being engulfed. Firefighters held off the flames.

Noralta houses employees of Syncrude Canada Ltd., Suncor Energy Inc. and other energy companies. Syncrude's and Suncor's oil sands operations remained shut down on Sunday.

"We do have to go through a process of having it inspected and making sure that everything is good to go – assessing the site for damage. That's happening now," said Blaire McCalla, spokeswoman for Noralta.

The facility, which had taken in about 1,000 Fort McMurray residents and first responders when the city itself was initially evacuated, was itself evacuated early last week, along with several others, as fire threatened the area. Before then, crews had created a fire break around the camp.

"That and some extraordinary firefighting is what held the fire off," Ms. McCalla said.

The fire destroyed the Blacksand Executive Lodge, a 665-room work camp owned by Horizon North Logistics Inc.

Now, companies are devising plans to restart production even as the fire still burns. On Saturday, the Alberta government said the blaze, nicknamed "the Beast," held steady at about 5,000 square kilometres, though much of it has moved east of Fort McMurray.

Syncrude is in the process of planning to get its employees back on site, spokesman Leithan Slade said. This is the first time the project, which produces about 350,000 barrels a day, has been fully off-line since it started commercial operations in 1978. There is no word yet on when it will restart.

"One of the reasons we had to move personnel off-site earlier last week was due to the lack of work accommodations in the region, as several were evacuated," Mr. Slade said. "Camp accommodations are something we continue to look at as part of our safe return to operation."

The Regional Municipality of Wood Buffalo lifted mandatory evacuation orders for six other camps, including ones operated by Syncrude and Suncor. Others remain off-limits.

On Friday, Suncor said it planned to bring small numbers of employees back to its operations beginning as early as Monday in the first steps toward restarting production.

There have been no reports of major damage to oil sands production facilities.