Keystone Pipeline Shutdown Raises Costs for U.S. Gulf Refiners

Katie Ramirez
November 1, 2019

TC Energy Corp. says it has shut down the Keystone pipeline while it investigates a potential oil spill in North Dakota.

Current incident estimates published by the company say that 9,120 U.S. barrels (383,040 gallons) or "approximately half the size of an Olympic-sized swimming pool" of crude oil were released into an impacted area of 2,500 square yards - which is "less than half the size of a football field".

"This is not the first spill from Keystone 1; the pipeline had a dozen spills in its first year of operation alone", the environmental organization noted. North Dakota Department of Environmental Quality personnel are at the site and monitoring the investigation and remediation.

Crews on Tuesday shut down the pipeline that carries tar sands oil from Canada through seven states after the leak was discovered said Karl Rockeman, North Dakota's water quality division director.

On Wednesday, TC Energy said on its website that the Marketlink system was not affected by the Keystone outage, which was shut from Hardisty, Alta., to Cushing, Ohio and to Wood River-Patoka, Ill.

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A segment of the pipeline in Missouri was shut down in early February for almost two weeks after a leak of about a dozen barrels of oil was discovered.

The Keystone outage also disrupted flows on the Marketlink pipeline, which has a capacity to flow 119 million lpd and is connected to Keystone, roiling oil prices at the delivery point for US crude futures.

The pipeline spill and shutdown comes as the company seeks to build the $8 billion Keystone XL pipeline that would carry tar sands oil from Alberta, Canada, to refineries in Texas. After the Keystone spill in South Dakota in 2017, prices widened from about $11 a barrel to more than $25 a barrel. Phase one started operating in 2011. Two other pipeline projects including the government-owned Trans Mountain line to Vancouver area as well as the proposed Keystone XL have faced regulatory and legal delays in addition to fierce opposition from environmental groups and landowners.

-With assistance from Michael Bellusci and Sharon Cho.

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