Oil and Gas

Husky Energy rushes to clean up Canada oil spill

July 22 (Reuters) - Crews rushed to clean up on Friday an oil leak by Husky Energy into a major Canadian river, as officials focused on concerns about contaminating drinking water of communities downstream.

The company said late on Thursday it shut and isolated a pipeline on its Saskatchewan Gathering System, after roughly 200,000 to 250,000 liters of heavy oil and diluent spilled from the line, running into the North Saskatchewan River.

“My understanding is that the leak is stopped, the site is contained, and they are fully into clean-up phase,” said Karen Hill, spokeswoman for Saskatchewan’s environment ministry, in an email.

The city of North Battleford draws its drinking water from the river, and planned to shut supply intakes if the oil spill reached the community of 14,000 people, city environment manager Tammy MacCormack told Global News.

The Saskatchewan government said it had dispatched an environmental protection officer to the site and was working with Husky to notify downstream users of the river.

The Saskatchewan Gathering System runs from Husky’s heavy oil operations east of Lloydminster to the company’s facilities in that city, where the oil is upgraded, used in asphalt or shipped on to the oilsands hub of Hardisty, Alberta.

The North Saskatchewan River is a major tributary to the Saskatchewan River, which flows east across Saskatchewan and Manitoba into Lake Winnipeg.

Last year, a pipeline owned by Nexen Energy ULC leaked 35,000 barrels of emulsion - a mixture of bitumen, water and sand - in Alberta in one of North America’s largest-ever oil-related spills on land.

In that case, the pipeline’s leak detection systems failed, and it could have been leaking for weeks before the spill was detected by a contractor walking along the line.

Earlier on Friday, Husky posted a smaller-than-expected loss as the focus on fewer, more efficient resource plays helped reduce production costs. (Reporting by Rod Nickel in Winnipeg, Manitoba)