OBE - Alberta wildfires could put 500K boe/day of production at risk of curtailment

2023-05-19 17:56:24 ET

The number of wildfires in Canada's Alberta province continued to rise Friday to 94, including 26 considered out of control, shutting ~240K boe/day of energy production - and perhaps more than 300K - consultant Rystad Energy estimated.

Research firm Enervus said 500K boe/day could be at risk of curtailment , with ~10K producing wells affected.

The disruptions are starting to weigh on oil stocks at the critical Edmonton hub, where storage tanks recently were holding 18.1M barrels, according to Bloomberg, down from 19.7M million at the start of May; volumes at Alberta's other major hub, Hardisty are further away from the fires and holding broadly steady.

The wildfires could shave off 0.1%-0.3% of Canada's real gross domestic production this month, according to an estimate from ATB Financial.

According to Enervus' data collection of companies that have announced shut-ins, Cenovus Energy ( CVE ) shut in multiple producing conventional fields and brought down processing plants, causing the curtailment of ~85K boe/day.

Crescent Point Energy ( CPG ) shut in its Kaybob Duvernay production, then reactivated part of it before shutting back in its 45K boe/day in the area.

NuVista Energy ( OTCPK:NUVSF ) shut in and depressured all operations threatened by wildfires, impacting 40K boe/day.

Between shutdowns of its own fields and the third-party Wapiti gas processing facility, Paramount Resources ( OTCPK:PRMRF ) said 45K boe/day were curtailed.

Whitecap Resources ( OTCPK:SPGYF ) said 26K boe/day was shut-in, Pipestone Energy ( OTCPK:BKBEF ) reported 20K boe/day had been curtailed, and Baytex Energy ( BTE ) said 20K boe/day of its own production was curtailed and 4K boe/day was cut because of third-party infrastructure closures.

Obsidian Energy ( NYSE: OBE ) said Thursday it restored some operations but 7,400 boe/day remained curtailed across its Pembina and Peace River holdings.

Vermilion Energy ( VET ) said it restored ~60% of the 30K boe/day of production that had been shut-in.

Tourmaline Oil ( OTCPK:TRMLF ) reported net production of ~16K boe/day remained shut-in, Kelt Exploration ( OTCPK:KELTF ) said it stopped 5K boe/day of production, and Athabasca Oil ( OTCPK:ATHOF ) shut in 2,300 boe/day.

TC Energy ( NYSE: TRP ) said May 17 it continues to run its NOVA gas transmission and other pipeline systems in western Canada, and progress continues on the Coastal GasLink with the project route safely away from current wildfires.

More on TC Energy:

• Financial and valuation comparison to sector peers
• Analysis: TC Energy's Juicy 7% Dividend Yield
• Stock price return: Up 3% YTD, down 29.5% in the past 12 months

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