May 16 (Reuters) -

More than half of the oil sands production from Canada could

be impacted if the wildfires in Alberta and British Columbia

worsen, Rystad Energy said in a report on Thursday.

WHY IT'S IMPORTANT

Canada is one of the biggest oil sands producers in the

world.

Companies like Suncor Energy ( SU ), Canadian Natural

Resources ( CNQ ) and Imperial Oil ( IMO ) have oil sands

projects within 150 km of Fort McMurry, an oil sands hub in

Northern Alberta, with many workers living in the city.

In 2016, a huge wildfire shut in over 1 million bpd of

output in Fort McMurry.

CONTEXT

Canada's oil sands industry produces roughly 3.3 million

barrels per day of crude, two-thirds of the country's total

energy output.

Last year, more than 200,000 bpd of oil output was shut in

due to the fires. There are currently 43 active fires in

Alberta.

Wildfire season typically runs from April until September or

October, when cooler temperatures and rain help dampen fire

activity in Canada.

BY THE NUMBERS

May is seasonally the maintenance season for the oil

industry as it gets ready to ramp up production for the

higher-demand summer driving season in North America, with an

estimated 365,000 bpd going offline.

Excluding that, Rystad Energy estimates more than 2.1

million barrels per day (bpd) of oil sand output could be

impacted in a worst-case scenario, or 2.6% of global crude and

lease condensate production.

This comes up to around 52% of affected volumes of the

synthetic crude produced from Canadian facilities, when

accounting for maintenance impacts, or closer to 60% when

excluding it.

KEY QUOTE

"The current flora around Fort McMurray is still recovering

from the events that took place eight years ago, thus, MFW-017

(the current out-of-control blaze) is spreading on the ground at

a slower pace," said Thomas Liles, vice president of upstream

research at Rystad Energy.