The current economic situation and COVID-19 pandemic may be claiming its first victim in the Canadian oilsands.
Teck Resources is currently looking into temporarily shutting down Fort Hills, which they own over 21 per cent share of. The oilsands is around 90 km north of Fort McMurray.
During an investor call on Wednesday, Don Lindsay, President and CEO, said, along with the virus, the production fight between Russia and Saudi Arabia is having a real toll on the global market.
“Significant incremental supply from Saudi Arabia and Russia is expected to be delivered to the market, although it’s still volatile, these conditions could last anywhere between six to 24 months.”
Suncor Energy, which operates and owns the majority of Fort Hills share, previously stated they were reducing the site to a ‘one train operation.’
The number of workers at the site is also limited. Only employees with essential positions are allowed on site as the two companies try and limit the spread of the virus.
“The primary focus is safety related to COVID-19 and from preventing the virus from getting into the work camp,” added Lindsay.
Meanwhile, there’s no exact timeline on when the site would be shut down and restarted.
When operating at full capacity, Fort Hills can produce around 194,000 barrels per day. It achieved its first oil production in January, 2018.