Canadian Natural Resources Limited says it’s time to drop the “Made in Fort McMurray Cost.” President Steve Laut spoke at the Fort McMurray Chamber of Commerce’s monthly luncheon yesterday. He took a few opportunities to say if the region doesn’t change its ways it will face a “death spiral” in the midst of oil prices.
“How do we do the job effectively? So if we’re doing it more effectively, it costs us less, the contractor still makes more money, the guys that are working for him still got a job,” said Laut.
He said contractors, suppliers and support services need to find a more efficient way of doing work, otherwise the industry will continue with a profit loss. He noted the relative cost of a turnaround in Fort McMurray is almost double (1.8) the cost of a similar turnaround in the U.S. Gulf Coast. For those that considered a number of other factors, he argued it’s also 1.15 times more expensive than the rest of Alberta.
Laut says it’s a global phenomenon that’s more amplified in Fort McMurray. In his speech, he also said municipal taxes are now the fastest rising cost for the company and oil will eventually sit between $60 – $70 a barrel.
