An explosion at a trucking company rocked the town of Castor, Alta., on Tuesday, forcing the evacuation of some businesses, a school and a daycare.

RCMP said the initial explosion happened in the mechanical building of Terraco A & E Oilfield Services just before 10 a.m. MT on Tuesday, followed by other blasts as the fuel tanks of several trucks parked inside caught fire.

'We got a lot of phone calls this morning because people felt the explosion and they heard it, and they weren't sure where it came from.'— Sandy Jackson, assistant chief administrative officer

Three men working inside the shop were taken to hospital with non-life-threatening injuries.

Volunteer firefighters working in frigid temperatures had the fire contained by lunch, said Sandy Jackson, Castor's assistant chief administrative officer.

Castor is in east-central Alberta, 245 kilometres southeast of Edmonton and 290 kilometres northeast of Calgary.

Jackson said she heard about the problem when people called the town office in a panic.

"We got a lot of phone calls this morning because people felt the explosion and they heard it, and they weren't sure where it came from," she told CBC News.

Gus Wetter School, a nearby daycare and some businesses were evacuated as a precaution, Jackson said, but not many children were at school because of the extreme cold.

The cause of the explosion is unknown. Coronation RCMP, Alberta Occupational Health and Safety and the Castor fire department are investigating.

Const. Brett Torpe said he believes the damage from the explosion and fire will be substantial.

"The value will be extremely high. It was a larger building and there was several commercial vehicles in there along with several, various tools and other supplies," he said.