In a recent announcement, the federal government unveiled a proposed settlement for the Keystone Pipeline’s owners and operators, stipulating a payment of $26.9 million in civil penalties. This action comes as a result of a significant oil spill in December 2022, which poured almost half a million gallons of crude oil into a creek in Kansas.
Additionally, the settlement mandates the company to invest approximately $40 million in preventative measures to avert future incidents, as detailed by the U.S. Environmental Protection Agency (EPA).
The Environmental Protection Agency, along with the Department of Justice and the state of Kansas, has accused the pipeline operator, South Bow, a company based in Canada, of breaching both U.S. and Kansas state clean water regulations. This proposed settlement aims to address and resolve these allegations.
The incident in 2022 resulted in around 13,000 barrels of heavy crude oil being released into a creek that winds through a rural pasture area in Washington County, Kansas, approximately 150 miles away from Kansas City.
Marking the most extensive onshore crude pipeline spill in the United States in nearly a decade, the accident outstripped all prior 22 spills on this pipeline system combined, as highlighted by a 2021 U.S. Government Accountability Office report. The oil spill volume was nearly equivalent to filling an Olympic-sized swimming pool.
South Bow also would pay Kansas more than $3 million for environmental restoration projects under a proposed decree filed Friday in U.S. District Court in Kansas. A judge would have to approve the proposal after a 30-day public comment period.
“The oil spill blanketed land and water, rendering the waterway lifeless and useless and requiring extensive cleanup and remediation,” Jeffrey Hall, the EPA’s assistant administrator for its enforcement office, said in a statement. “The substantial penalty reflects the seriousness of the environmental harm.”
South Bow officials did not respond immediately Sunday to a phone message and email seeking comment, but the company told The Canadian Press that it “proactively” began cleaning up the area before receiving directives from U.S. officials. The cleanup was completed early in 2024.
The company that built the pipeline, TC Energy, spun off South Bow as a separate firm in 2024, after the Kansas cleanup was done.
No pipeline workers or area residents were injured, and officials said public water supplies weren’t affected by the spill. However, a complaint filed Friday by the U.S. government along with the proposed settlement said more than 2,700 animals were harmed or killed. The area is home to an endangered species, the long-eared bat.
In a May 2023 report for the U.S. government, an engineering consulting firm said that a bend in the Keystone system where the spill occurred had been “overstressed” since its installation in December 2010 — likely because construction activity itself altered the land around the pipe. The complaint filed Friday in court said soil under the pipe had been “improperly compacted” and that while the company re-excavated the site in 2013, it did not replace that section of pipe.
The 2,689-mile Keystone system carries thick, Canadian tar sands oil to refineries in Illinois, Oklahoma and Texas.
In April, President Donald Trump gave the go-ahead for South Bow and another company to build a second pipeline from Canada to Wyoming, a smaller version of a massive $8 billion pipeline project known as Keystone XL blocked by former President Joe Biden’s administration in 2021 over environmental concerns.