Fire at Syncrude oilsands upgrader extinguished

Two days after an explosion at Syncrude's Mildred Lake oilsands plant, the fire has been extinguished.

Emergency crews safely stifled the flames inside the hydrotreating area of the plant early Thursday morning, company officials say. The fire had been isolated and under control since since Tuesday afternoon.

"My deepest appreciation goes out to everyone who responded to this incident," Syncrude CEO Mark Ward said in a statement. "This remains a difficult time for our organization, but I am proud of the tireless efforts of our employees to ensure the safety and stability of our operations."

The fire broke out just before 2 p.m. Tuesday. An injured worker was taken to Fort McMurray's Northern Lights Regional Health Centre in serious but stable condition.

The worker was later transferred to Edmonton. Officials have not provided any details on the identity of the worker or the extent of the worker's injuries.

A line failure caused treated naphtha — a highly flammable light oil — to leak, triggering the explosion.

Crews had been allowing the the fire to burn itself out, considered the safest way to dispose of residual material.

The company will now work to "fully isolate the impacted area" to ensure it's safe.

Once the site is secure, the company will begin its own investigation and assess the damage. The Alberta Energy Regulator and Occupational Health and Safety officials will also be investigating.

Most of Syncrude's workforce has returned to the oilsands mining complex and the upgrader is still operating despite the fire. The rest of the company's operations remain "stable," with several upgrader units on reduced rates, Syncrude officials said in a statement.

The fire happened at one of the two hydrotreaters at Syncrude's upgrader. The units are designed to start the upgrading process by separating heavy bitumen crude oil into components.

The incident raises questions about Syncrude's operational reliability after it posted some of the best results in its 40-year history last year.

TD Securities analyst Menno Hulshof said in a note to investors that Syncrude averaged more than 98 per cent utilization in the second half of 2016, an improvement attributed by some to Suncor Energy increasing its stake in the ownership consortium from 12 per cent to 54 per cent through buyouts of two other partners.

He said Syncrude's 2017 utilization guidance of 84 per cent, which includes downtime for planned maintenance, will probably fall along with production levels because of the fire.

A fire at the Mildred Lake upgrader in August 2015 slashed output at the facility by about 80 per cent before it returned to normal production by October.