Wildfires knock out a third of power from Canada's oils sands operations

Wildfires in the region of Canada's oil sands operations had hit the flow of electricity reducing it to almost a third and forced thousands of people to evacuate in what could prove to be the costliest catastrophe of the country (See: 80,000 evacuated as Canadian town turns into inferno).

Power supply from cogeneration plants that used steam from oil sands production was about 950 megawatts at 7 pm New York time yesterday, according to electricity grid data compiled by Bloomberg.

The figure was down 29 per cent from three days ago and natural gas output in the province had meanwhile dropped by a half-billion cubic feet a day since late April, data compiled by Bloomberg New Energy Finance showed.
While the fire might affect over a million barrels of oil sands capacity a day, the power and gas deficits showed how the impact of a blaze had wreaked havoc in Canada's most energy-rich region.

According to pipeline operator TransCanada Corp, there had seen a slight decline in gas demand as people moved out of the area and customers scaled back operations.

The volume of gas used by oil sands companies might fall by 150 million to 300 million cubic feet a day, according to New York consulting firm Pira Energy Group.

The wildfire that raged in the oil sands region knocked out as much as a third of Canada's daily crude capacity and closed some pipelines.

At least 680,000 barrels per day of capacity were offline yesterday, according to Reuters' calculations. That did not include the unspecified reduction in Syncrude output or Suncor thermal operations, meaning the total was likely higher.

Meanwhile, Imperial Oil Ltd said that by way of  precaution, workforce levels at its Kearl oil sands mining project had been reduced to essential staff only. Production had been reduced by an unspecified amount, adding that its physical plant was unaffected by the fires.