Keystone Pipeline shuts down after oil leak, halting flow of 600K barrels a day

Dec 9, 2022, 8:35 AM
Oil prices jump 4% after the Keystone Pipeline was shut down following a leak. Pictured is the pipe...
Oil prices jump 4% after the Keystone Pipeline was shut down following a leak. Pictured is the pipeline pumping station for the Keystone operations in Steele City, Nebraska, in July 2012. (Michael S. Williamson/The Washington Post/Getty Images)
(Michael S. Williamson/The Washington Post/Getty Images)

(CNN) — The Keystone Pipeline has been shut down following a leak discovered near the border of Kansas and Nebraska.

The shutdown of the major oil pipeline that carries crude from Canada triggered volatility in the energy market on Thursday, with oil prices briefly surging as much as 5% before retreating.

Federal safety regulators are investigating the leak and have deployed to the site, a spokesperson for the Pipeline and Hazardous Materials Safety Administration told CNN.

Canada’s TC Energy said it launched an emergency shutdown of the Keystone Pipeline System at 9 p.m. ET on Wednesday after alarms were triggered and pressure dropped in the system. The company said the system remains shut as “our crews actively respond and work to contain and recover the oil.”

Calgary-based TC Energy said there has been a “confirmed release of oil” into a creek located about 20 miles south of Steele City, Nebraska. An estimated 14,000 barrels of oil have been discharged as of late Thursday, the company said.

The PHMSA, an arm of the Transportation Department charged with enforcing safety regulations for pipelines, said the leak is located near Washington, Kansas, which is near the border with Nebraska.

The spokesperson said the agency continues to investigate the cause of the leak.

U.S. oil prices climbed as high as $75.44 a barrel on the news, before easing. In recent trading, oil was up 0.8% to $72.57 a barrel. The gains follow a steep selloff in recent days that left crude at levels unseen since December 2021.

No timetable has been given for restarting the Keystone Pipeline, a 2,700-mile system that delivers mostly Canadian oil to major refineries across America. The pipeline can transport more than 600,000 barrels of oil per day.

Matt Smith, an analyst at commodity data provider Kpler, said Canadian oil normally transported by Keystone can’t be easily replaced.

“We’re seeing a pop in prices because this will impact refiners that take this crude,” Smith said.

“Our primary focus right now is the health and safety of onsite staff and personnel, the surrounding community, and mitigating risk to the environment through the deployment of booms downstream as we work to contain and prevent further migration of the release,” TC Energy said in a statement.

The leak happened on an existing Keystone pipeline that is separate from Keystone XL, a controversial pipeline project that was terminated last year after President Joe Biden revoked the pipeline’s permit on his first day in office.

The Keystone Pipeline has experienced leaks in the past, including one in South Dakota in 2016 and another one in 2019 in North Dakota that impacted nearly five acres.

™ & © 2022 Cable News Network, Inc., a Warner Bros. Discovery Company. All rights reserved.

KSL 5 TV Live

Top Stories

National News

President Joe Biden delivers the State of the Union address to a joint session of Congress at the C...
Zeke Miller, Seung Min Kim and Lisa Mascaro, Associated Press

Biden in State of Union exhorts Congress: ‘Finish the job’

President Joe Biden has exhorted Republicans in his State of the Union address to work with him to “finish the job” of rebuilding the economy and uniting the nation.
13 hours ago
Rep. George Santos, R-N.Y., Rep. Matt Gaetz, R-Fla., and other Republicans gather in the House Cham...
Lisa Mascaro and Mary Clare Jalonick, Associated Press

GOP on GOP: Romney scolds Santos, ‘You don’t belong here’

Congressman George Santos' presence at the center aisle for Tuesday night's speech was met with a stern rebuke from a fellow Republican, Sen. Mitt Romney of Utah.
13 hours ago
SANTA FE, NEW MEXICO - OCTOBER 22: A general view shows a locked gate at the entrance to the Bonanz...
Associated Press

Alec Baldwin wants prosecutor in on-set death case dropped

Defense attorneys for actor Alec Baldwin are seeking to disqualify the special prosecutor in the case against him stemming from the fatal shooting of a cinematographer on a New Mexico film set.
13 hours ago
FILE: Powerball and Mega Millions lottery tickets are displayed on January 3, 2018 in San Anselmo, ...
Associated Press

Lucky player in Seattle suburb wins $754.6M Powerball prize

A single winning ticket for a $754.6 million Powerball jackpot was sold at a department store in a Seattle suburb, Washington state lottery officials said Tuesday.
2 days ago
(From left) Emma Stone and Ryan Gosling are pictured here in 2016's "La La Land." (Dale Robinette/L...
Alli Rosenbloom

Musical adaptation of ‘La La Land’ is dancing its way to Broadway

Get your dancing shoes ready, because "La La Land" is coming to Broadway.
2 days ago
Sailors assigned to Explosive Ordnance Disposal Group 2 recover debris from a suspected Chinese sur...
Haley Britzky

US Navy releases photos of Chinese spy balloon recovery effort

The U.S. Navy released photos Tuesday of its recovery effort of a suspected Chinese spy balloon, which U.S. fighter jets shot down over the Atlantic Ocean on Saturday.
2 days ago

Sponsored Articles

vintage photo of lighting showroom featuring chandeliers, lamps, wall lights and mirrors...
Lighting Design

History of Lighting Design | Over 25 Years of Providing Utah With the Latest Trends and Styles

Read about the history of Lighting Design, a family-owned and operated business that paved the way for the lighting industry in Utah.
Fiber Optical cables connected to an optic ports and Network cables connected to ethernet ports...
Brian Huston, CE and Anthony Perkins, BICSI

Why Every Business Needs a Structured Cabling System

A structured cabling system benefits businesses by giving you faster processing speeds and making your network more efficient and reliable.
notebook with password notes highlighted...
PC Laptops

How to Create Strong Passwords You Can Actually Remember

Learn how you can create strong passwords that are actually easy to remember! In a short time you can create new ones in seconds.
house with for rent sign posted...
Chase Harrington, president and COO of Entrata

Top 5 Reasons You May Want to Consider Apartment Life Over Owning a Home

There are many benefits of renting that can be overshadowed by the allure of buying a home. Here are five reasons why renting might be right for you.
Festive kitchen in Christmas decorations. Christmas dining room....
Lighting Design

6 Holiday Decor Trends to Try in 2022

We've rounded out the top 6 holiday decor trends for 2022 so you can be ahead of the game before you start shopping. 
Happy diverse college or university students are having fun on their graduation day...
BYU MBA at the Marriott School of Business

How to Choose What MBA Program is Right for You: Take this Quiz Before You Apply!

Wondering what MBA program is right for you? Take this quiz before you apply to see if it will help you meet your goals.
Keystone Pipeline shuts down after oil leak, halting flow of 600K barrels a day