CNRL warns of lower output due to production constraints at Scotford

CNRL warns of lower output due to production constraints at Scotford

Canadian Natural Resources (CNRL) warns production out of its Albian operations will be 10,000 bbl/day below plan, primarily due to production constraints at the Scotford upgrader.

Scotford suffered a fire in the middle of April, while the facility was being shut down for a planned 38-day maintenance turnaround.

The fire was contained to a process furnace in the North Upgrader, an expanded area of the facility. Operations at its base South Upgrader were not affected. Shell Canada, who operates the facility, is still investigating the cause of the incident, and has yet to assess the extent of the damage.

CNRL now says Scotford will average 200,000 bbl/day for the months of April and May, down from a previous estimate of 230,000 bbl/day.

Scotford has a production capacity of 255,000 bbl/day, but production was scaled back due to Alberta's curtailment quotas. The facility processes mostly heavy diluted bitumen from the Albian mining operations, producing light synthetic crude oil (SCO). 

 
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As a result of the constraints at Scotford, CNRL now says production out of Albian will be reduced to an average of  245,000 bbl/day in May and June, down 10,000 bbl/day from previous estimates. Albian includes both the Muskeg River and Jackpine mining operations.

Earlier this year, the company set its full-year mining and upgrading output guidance to between 415,000 and 450,000 bbl/day, reflecting the province's curtailment quotas for both its Albian and Horizon operations. The company has yet to revise those figures. CNRL has a 70% stake in both the Scotford upgrader and two Albian mines, while Shell and Chevron own the remaining 30%.

Planned maintenance activities continue at the North Upgrader. Cost and timing for repair and return to normal operation has yet to be determined.

CNRL is due to report first quarter results on May 9, 2019.

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