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Flooding Prompts Evacuation At Heart Of Canada’s Oil Sands

The Regional Municipality of Wood Buffalo, which includes Fort McMurray – the hub of Alberta’s oil sands business – has issued a mandatory evacuation order for all of downtown Fort McMurray after a river flooded the area.

There hasn’t been any flooding to sites of oil companies with operations in the area, Karim Zariffa, executive director of the Oil Sands Community Alliance (OSCA), told Reuters.

Some of the oil sands firms are helping to pump water out of flooded areas by sending emergency staff, Zariffa told Reuters.

The ice on the Athabasca River broke on Sunday and resulted in major flooding, also prompting a secondary state of local emergency in the area, which is already under a state of emergency due to the coronavirus pandemic.

Natural disasters in the Fort McMurray area are nothing new. Back in 2016, major wildfires forced oil sands companies in the area to evacuate thousands of oil workers and shut down operations.

This year’s wildfire season has yet to come, but Fort McMurray is already grappling with efforts to contain the pandemic and with the new disaster—the flooding.

As if natural disasters weren’t enough, Fort McMurray –and Alberta’s oil industry – are struggling with the oil market disaster these days, after prices started plunging in early March following the (temporary) end of the OPEC+ deal and the massive oil demand loss in the pandemic.

Canadian producers have already started shutting down steam-driven oil sands production projects, Reuters reports, noting the move could have dire long-term consequences for the production facilities. Husky Energy cut its oil sands output by 15,000 bpd. Cenovus reduced its production by 45,000 bpd and said it could raise this further to 100,000 bpd, nothing a cut of this size wouldn’t damage the bitumen reservoirs. ConocoPhillips said it would cut its oil sands output by as much as 100,000 bpd.  

By Tsvetana Paraskova for Oilprice.com

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