Imperial Shuts Kearl Oil Sands Operations After Pipeline Outage

(Reuters) — Imperial Oil on Wednesday said it had shut all production at its 220,000 barrel-per-day Kearl oil sands site in Canada due to an outage at a third-party diluent pipeline following a leak detected on Aug. 29. 


“The impact of the outage and a timeline for restart is unknown at this time,” the company said in a release.

Apart from the Imperial site, the outage on Inter Pipeline’s 865,000 barrel-per-day Polaris diluent line due to a leak southeast of Fort McMurray, Alberta could also impact operations at Husky Energy’s Sunrise oil sands facility, Eight Capital said in a note.

The pipeline supplies ultralight oil to oil sands sites to be blended with heavy oil for transport.

The outage resulted in the discount on Canadian heavy oil to West Texas Intermediate to drop by $1.35 per barrel to $9.70, and it could drop further, Eight Capital said. 

Inter Pipeline and Husky could not be immediately reached.

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