The U.S. Department of Justice has finalized an agreement with South Bow Corp, a pipeline company, concerning a rupture that occurred in 2022 on the Keystone pipeline, leading to the release of almost 13,000 barrels of oil in northern Kansas.
As part of the settlement, the Calgary-based company will pay a $26.9 million US civil penalty for alleged violations of the Clean Water Act. Additionally, South Bow has committed to investing around $40 million US in preventive measures to avert similar incidents in the future. The company will also allocate $3 million US for state natural resource restoration projects to address breaches of state regulations.
In a recent statement, the Justice Department highlighted that the spill was one of the largest inland oil leaks in recent times and the most significant from the Keystone pipeline network, stretching from Hardisty, Alberta, to Port Arthur, Texas.
Adam Gustafson, deputy assistant attorney general, emphasized the swift escalation of pipeline leaks, underscoring the importance of the preventative actions outlined in the settlement.
According to Jeffrey Hall, assistant administrator at the U.S. Environmental Protection Agency, maintaining pipelines adequately is crucial, as evidenced by the widespread environmental impact and the need for extensive cleanup and remediation following the spill.
The Justice Department reported that the crude oil spill covered Mill Creek extensively, with a thickness of over two centimeters for 5.6 kilometers from the rupture site, resulting in the deaths or harm of more than 2,700 animals.
South Bow stated that it took proactive measures, including cleanup efforts initiated before formal directives from U.S. authorities, with the site cleanup completed by February 2024.
South Bow’s spokesperson, Sara Hunter, mentioned that the company has conducted inspections on nearly 3,400 kilometers of the Keystone system and performed over 70 verifications to ensure the line’s integrity. The company continues to enhance the system through remedial and mitigative actions.
The spill occurred when the pipeline was under TC Energy Corp., which later separated its oil pipeline business, leading to the formation of South Bow in late 2024.
South Bow is planning to expand its cross-border crude pipeline network, with initiatives like the Prairie Connector project, soliciting bids for unused pipe sections originally intended for the Keystone XL expansion. The Prairie Connector project aims to connect to another proposed pipeline by Bridger Pipeline LLC, extending from the Canada-U.S. border to Wyoming.