The danger of wildfires in Canada’s main oil-producing province is projected to rise amid hot and dry conditions over the weekend and into next week.
(Bloomberg) — The danger of wildfires in Canada’s main oil-producing province is projected to rise amid hot and dry conditions over the weekend and into next week.
Recent rain and cooler weather in western Alberta have helped reduce the number of wildfires to 76 from more than 100 earlier in the week, allowing oil and gas producers to restore some output that was shut down. But the favorable conditions aren’t expected to last, officials said on Friday.
“We are expecting hot and dry conditions in most of the province, which will make the wildfire danger climb,” Josee St-Onge, spokeswoman for Wildfire Alberta, said at a news conference on Friday. “We are likely to see more intense wildfire activity this weekend and into early next week.”
This month’s blazes have largely spared the oil sands, but they have hammered the province’s drought-stricken west, forcing the evacuation of as many as 30,000 people and curtailing natural gas output. That pattern is shifting, with Fort McMurray, the biggest city in the oil-sands region, expected to see temperatures of 32C (90F) on Sunday, according to Environment Canada.
The number of out-of-control wildfires was already starting to rise on Friday. A total of 22 fires were considered out of control by 4 p.m. Mountain time, up from 20 earlier in the day.
Oil and gas producers have brought output back online in recent days as the blazes in the west die down. Crescent Point Energy Corp. has now restored 85% of the 45,000 barrels a day of oil equivalent Kaybob Duvernay production that was shut due to the fires, up from 75% two days ago, the company said Friday. Chevron Corp., which had evacuated its facilities earlier in the week, has “resumed operations in the Kaybob Duvernay outside of the fire affected area,” spokeswoman Deena McMullen said by email.
Pembina Pipeline Corp. said Thursday that facilities shut due to fires have resumed operations. Peyto Exploration & Development Corp. also said it has restored essentially all production from two plants that were shut.
The output cuts may have affected flows of the light condensate that’s mixed with oil-sands crude to help move through pipelines, helping strengthen prices for Canadian heavy oil. On Friday, Western Canadian Select’s discount to the US benchmark shrank 25 cents to $12.85 a barrel, the narrowest in more than a year, data compiled by Bloomberg show. AECO gas prices in Alberta fell 0.9% to C$2.10 per million British thermal units on Friday, but still were up 11% for the week.
This year’s wildfires have been far less destructive than those that tore through Canada’s oil sands seven years ago. The blazes of 2016 shut down more than 1 million barrels of daily crude production and razed whole sections of Fort McMurray.
The number of evacuees has fallen to fewer than 17,000 from as many as 31,000 earlier in the week. More than 1,000 people were fighting fires on Friday from throughout Canada and the US. An additional 200 firefighters from the US are expected to arrive Saturday.
“While the recent rain and cooler weather in parts of Alberta has brought relief to some areas, we remain in an extremely volatile situation, and the risk of new wildfires remains significant in much of the province,” said Colin Blair, executive director of Alberta Emergency Management Agency. “It will take much more than a few scattered showers to change the wildfire situation.”
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