Imperial Oil says it will shutter Norman Wells oil operations this summer
CBC
Imperial Oil says it will end more than a century of oil production in Norman Wells later this year.
The closure has been in the works since 2022, but until now, there has been no solid timeline for the shutdown.
In a news release Friday, the company said the move is needed because of declining production at the site.
It said production is slated to end in the third quarter of 2026 "as the facility comes to the end of its lifespan."
“Today marks the first of many milestones in our closure journey with communities that have been our home for more than a century,” said Cheryl Gomez-Smith, Imperial’s senior vice-president of upstream in the release.
“We’re proud of our contributions to the northern economy over generations. We remain committed to supporting our employees through this transition and to collaborating with local communities and stakeholders through the closure process.”
In addition to drilling for oil, Imperial also operated a power plant that provides electricity to Norman Wells. The company said it plans "a smooth transition of power generation for the community, and there are no near-term changes to the fuel supply arrangements currently in place."
In a statement, Northwest Territories Premier R.J. Simpson said the news is not a surprise given the age of the facility, declining production and the low price of oil.
"It is still disappointing," Simpson said. "It also comes at a time when stability matters. In the immediate period ahead, our focus as a government is on support, certainty and a responsible path forward."
Doug Matthews, a Calgary-based oil and gas analyst, said the closure is simply the product of cold economic reality.
"It was still fairly small potatoes in terms of the total Imperial Oil production, and with the price of oil being where it is, around about $60 [per barrel], and depending on what firm you want to talk to, could go to $50 next year," he said. "The income generated from the field is just not that good."
N.W.T. MP Rebecca Alty said in a statement that news of the closure is difficult.
"My thoughts are with the workers, families and community members who are affected," she said. "A change of this scale is never easy and the uncertainty it brings can be especially hard."
The company said it's working on a final closure and reclamation plan for the site. Reclamation work is not expected to start after 2030.
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