Canadian firefighters make progress against fire in oil sands region

CALGARY, Alberta (Reuters) - Firefighters made progress against a wildfire in the Fort McMurray region of northern Alberta on Thursday as a shift in winds pushed it away from communities and oil sands facilities.

A Canadian flag flies over damage caused by a wildfire, which prompted the mass evacuation of over 88,000 people, in Fort McMurray, Alberta, Canada on May 14, 2016. Chris Schwarz/Government of Alberta/Handout via REUTERS

The massive blaze has charred 505,000 hectares (1.2 million acres), up from 483,000 on Wednesday. On Thursday, it moved to the neighboring province of Saskatchewan, but Alberta wildfire officer Chad Morrison said cooler weather and rain would aid efforts to get it under control.

“We saw a trace of rain this morning, so that’s actually helped our firefighting efforts,” he added.

Morrison said the burned area equals the total consumed in last year’s entire fire season.

The blaze, which hit Fort McMurray in early May, surged north on Monday. It forced the evacuation of 8,000 oil sands workers, destroyed a work camp and prolonged a shutdown that has cut Canadian oil output by a million barrels a day.

Alberta’s GDP is expected to take a hit as a result of the fire, the government said this week, and comes on the back of a two-year slump in global crude prices.

Credit agency S&P lowered its debt rating for Alberta to AA from AA+ on Thursday, citing a weak budgetary performance and high debt.

Morrison said the fire burned near Suncor Energy’s base plant and the Syncrude facility on Wednesday, but fire breaks held and the threat has diminished.

The joint-venture Syncrude project told customers to expect no further crude shipments for May, trading sources said on Thursday, extending a force majeure on crude production from earlier in the month.

Syncrude spokesman Will Gibson declined to comment on deliveries.

“We are not making any oil and will not have forecasts for some time,” he said.

Still, in an encouraging sign, Imperial Oil said on Thursday it had restarted limited operations at its Kearl site, which was unaffected by the fires. The return to full operations depends on a number of factors, including safety and air quality, it said.


The fire destroyed a 665-room lodge for oil sands workers on Tuesday, but officials said on Thursday there was no further threat to facilities. Even so, a mandatory evacuation order remains in place at 19 work camps north of Fort McMurray.

The latest round of evacuations suggest production may be suspended for longer than companies and analysts had previously anticipated.

Some of the 90,000 evacuees who fled as the massive blaze breached Fort McMurray may be allowed to return as soon as June 1, if air quality improves and other safety conditions are met.

But Bob Couture, executive director of community and protective services for the Wood Buffalo region, said the wildfire could still potentially slow re-entry.

“As we see today, our weather has changed dramatically, however we know this beast and the conditions also change very quickly so we want to be prepared for anything,” he said.

The air quality health index, which usually stands between 1 and 10, was at 3 on Thursday morning but was expected to rise back above 10 on Thursday and Friday.

Additional reporting by Allison Martell and Ethan Lou in Toronto; Editing by Bill Trott and Cynthia Osterman