The U.S. Department of Justice has reached a settlement with South Bow Corp., a pipeline company, regarding a rupture of the Keystone pipeline in 2022 that resulted in the spillage of nearly 13,000 barrels of oil in northern Kansas. As part of the agreement, the Calgary-based company will pay a civil penalty of $26.9 million US for violating the Clean Water Act.
Additionally, South Bow has committed to investing around $40 million US in preventive measures to avoid similar incidents in the future. The company will also allocate $3 million US for natural resource restoration projects in the state to address violations of state laws.
According to the Justice Department, the spill was one of the largest inland oil spills in recent history and the biggest from the Keystone pipeline system, which stretches from Hardisty, Alberta, to Port Arthur, Texas. Adam Gustafson, deputy assistant attorney general, emphasized the importance of the company’s efforts to prevent future leaks as part of the settlement.
Jeffrey Hall, assistant administrator at the U.S. Environmental Protection Agency, highlighted the necessity of maintaining pipelines properly, citing the significant impact of the spill on the environment and wildlife. The spill covered Mill Creek bank-to-bank for 5.6 kilometers with crude oil more than two centimeters thick, resulting in the harm or death of over 2,700 animals.
South Bow stated that it took proactive corrective actions even before receiving formal directives from U.S. authorities, including completing site cleanup by February 2024. The company has inspected a significant portion of the Keystone system and conducted various remedial works to enhance its integrity.
The pipeline, previously owned by TC Energy Corp., experienced previous spills, with an estimated 3,500 barrels spilled in North Dakota in April 2025. South Bow aims to expand its cross-border crude pipeline system, seeking bids for its Prairie Connector project to utilize unused pipeline originally designated for the Keystone XL expansion. The Prairie Connector project is intended to connect to a pipeline proposed by Bridger Pipeline LLC from the Canada-U.S. border to Wyoming.
Overall, South Bow remains committed to ensuring the safe and reliable operation of its pipeline system and continuously strengthening pipeline integrity.
