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Oil production in Alberta suffers after fire

May 10, 2016

The oil city in northeastern Alberta has been left largely intact, despite a week of wildfire threatening its fringes. Tens of thousands have been evacuated and oil production significantly curtailed by blaze.

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Kanada Waldbrände bei Fort McMurray - Alberta Premier Rachel Notley
Image: Reuters/C. Wattie

Some 100,000 people were forced to flee from in and around the hard hit city of Fort McMurray, the epicenter of a fast-running wildfire and northern Alberta's oil sands region.

Oil output has been slashed by between a million and 1.5 million barrels of oil per day, a steep drop from around 2.5 million barrels daily.

"At this point, we are assuming about two weeks or so of one million barrels per day being out of production," said Douglas Porter, chief economist at the Bank of Montreal."It might end up being worse than this, that's for sure."

On the plus side, the city of Fort McMurray is largely intact despite a week of damage from the fires. Authorities warned, however, that the tens of thousands of evacuated residents would not be able to return for weeks.

Karte Waldbrände Kanada Englisch

Alberta Premier Rachel Notley said about 2,400 homes and structures were destroyed in the city, but firefighters managed to save 25,000 others, including the hospital, municipal buildings and every functioning school.

"This city was surrounded by an ocean of fire only a few days ago but Fort McMurray and the surrounding communities have been saved and they will be rebuilt," Notley said.

Kanada Waldbrände Alberta Hubschrauber
Some 700 firefighters continue to battle the blaze, supported by 20 helicopters and 27 air tankersImage: Imago/UPI Photo

Efforts continue to contain huge blaze

Fire chief Darby Allen said authorities need at least two weeks before being able to say when residents would be allowed to return to their homes.

"If that fire had gotten into downtown, we would have lost the downtown area," he said.

Despite the upbeat assessment, the wildfire is still advancing to the east and has ravaged more than 200,000 hectares (494,200 acres) of forestland.

"We expect cooler temperatures the next two days to continue to help us to have success in the communities and areas," Chad Morrison, senior wildfire manager for the Alberta province.

Minister of Public Safety Ralph Goodale urged evacuees to be patient. "The recovery here is not going to be quick and it's not going to be easy. It will be essential to make sure that can be done safely," he said.

Alberta's oil sands have the third-largest reserves in the world behind Saudi Arabia and Venezuela. Mainly oil workers live in Fort McMurray, a former frontier outpost whose residents mostly settled from elsewhere in Canada.

According to initial estimates damages and losses total some $9 billion (7.9 billion euros).

jar/bw (AP, AFP, Reuters)