July 9 (UPI) -- Canadian energy company Suncor said its Syncrude oil sands facility, crippled by a June power outage, will be back at full capacity by September.
U.S. crude oil prices were supported last month when Suncor announced it stopped processing light, sweet crude from its Syncrude facility in Alberta after a June 20 power disruption hobbled the plant. The company said a preliminary investigation indicated a transformer tripped.
On Monday, the company said it has developed a return-to-service plan and that repairs to the transformer are under way. One production facility with a capacity of 150,000 barrels per day will be online by the second half of this month. A second 100,000 barrel-per-day facility will be in service by the middle of August.
"Pipeline shipments of treated product are estimated to be approximately 60 percent to 70 percent of capacity for August," the company stated. "It is expected that Syncrude will ramp up to full production in early to mid-September."
The definitive plan is something of a relief to regional markets as roughly 60 percent of Syncrude production went to refineries in the U.S. Midwest.
The Syncrude facility reprocesses heavier oil sands from Alberta into a lighter blend that's easier for refiners to process. A research note from Morningstar emailed last week said that, without Syncrude supplies, the price of West Texas Intermediate would be higher because of the market disruption.
"Suncor's operational update regarding Syncrude should reduce concerns of ongoing crude shortages," Sandy Fielden, the director for oil and products research at Morningstar, told UPI on Monday.
WTI, the U.S. benchmark for the price of oil, was relatively flat early Monday to trade at $73.83 per barrel. That's up from the $68.58 for June 22, which marked the end of a week that saw WTI climb 5.4 percent.
Suncor announced in late January that it started producing the first batches of oil from its Fort Hills project in Alberta. Over the next few months, production should reach its peak at about 194,000 barrels per day.
The company realized an operating cost for oil sands operations of $19 per barrel, about a dollar less than fourth quarter 2016.