Alberta oil sands fire loss tallied at $726 million

The total insurance costs of the fire that halted production at the Horizon oil sands project in Alberta last year has been finalized at $726 million.

Canadian Natural Resources (CNR) Limited indicated in a release of fourth-quarter and year-end 2011 financial results that its Horizon coker fire business interruption claim was $333 million. An additional property damage claim amounted to $393 million.

“To date, the company has received total combined insurance proceeds of approximately $400 million, and expects to receive the remaining balance by the end of [2012’s first quarter],” CNR said in its release.

An explosion badly damaged an upgrader at the Horizon oil sands project north of Fort McMurray on Jan. 6, 2011. The explosion and ensuing fire forced CNR to shut down production of synthetic crude oil for several months. Full production did not resume until 2011 Q3.

The company attributed the fire to an error in a valve opening at the top of a coking drum.