CALGARY - An analyst says Canadian Oil Sands is at risk of missing its production targets because of a fire at a Syncrude oilsands plant over the weekend.

Syncrude was down for maintenance this spring, so it needed smooth operations for the remainder of the year to meet the mid-point of its projected output range, CIBC analyst Arthur Grayfer wrote in a research note Monday.

Canadian Oil Sands (COS) is the biggest partner in the vast Syncrude operation, with a 37 per cent stake. The other owners include Imperial Oil (TSX:IMO), Suncor Energy (TSX:SU), Murphy Oil, Mocal Energy and China's CNOOC Ltd. and Sinopec.

There was a fire early Saturday morning in the piping connecting the hydrotreating and environmental units at Syncrude's Mildred Lake upgrader north of Fort McMurray, Alta. The fire was put out quickly, no one was hurt and there was no environmental damage, the company said.

"Unfortunately, unplanned downtime at Syncrude has historically been an issue and could place guidance at risk," Grayfer wrote.

Canadian Oil Sands said in July it expected total daily output of synthetic crude oil to average between 263,000 barrels a day and 293,000 barrels a day this year.

"Currently, Canadian Oil Sands needs to average (about) 87% utilization for the remainder of the year (Aug-Dec) in order to achieve mid-point of guidance."

Canadian Oil Sands spokesman Scott Arnold said the mine continues to operate, as do extraction facilities and parts of the upgrader. But Syncrude has temporarily suspended production of synthetic crude — oilsands crude that's been upgraded to refinery-ready light oil.

He said bitumen and partially processed crude are being stored in tanks on site and it's not yet known how long the repairs will take.

"While the build of inventory could potentially mitigate the risk to guidance if the suspension of (synthetic crude) shipments is for a small period of time, if the suspension extends for a meaningful portion of time, there is risk to the achievement of 2015 guidance," wrote Grayfer.

Canadian Oil Sands (TSX:COS) said it has US$1.65 billion in combined property and business operation insurance, subject to a US$9-million deductible.

News from © The Canadian Press, 2015