Nexen Energy will eliminate 350 jobs after deciding to postpone repairs tied to an explosion at the Long Lake facility earlier this year.
According to Bloomberg, Nexen will cut jobs at its Long Lake facility and at its Calgary office after determining that an upgrader at Long Lake can’t be repaired in the short term.
Further details about the job cuts have not been disclosed yet.
Two workers died after an explosion on January 15 at the Long Lake oil sands facility south of Fort McMurray, Alberta.
Nexen CEO Fang Zhi told the Wall Street Journal on Tuesday that the processing unit damaged by the blast will not be repaired until the company conducts a long-term viability review of its oil sands operations.
The company, a subsidiary of China’s CNOOC, has not disclosed a timeline for the review or repairs.
According to the Calgary Herald, Nexen has concluded that the January blast was caused by employees working outside the scope of their approved duties.
Production at Long Lake is currently about 15,000 barrels per day compared to 50,000 barrels per day a year ago, the Wall Street Journal said.
Nexen plans to ramp up its bitumen production to as many as 27,000 barrels per day and will put the Long Lake Upgrader into winter preservation mode, according to Reuters.
Long Lake also suffered a pipeline leak that was discovered last July that spilled an estimated 31,5000 barrels of emulsion.
Nexen said on Tuesday that a probe into the pipeline spill revealed that the spill began around June 11, about a month before it was detected, CTV News Calgary said.