TransCanada: Keystone Pipeline Likely Source of Oil Spill in Missouri
TransCanada Corp. said its Keystone pipeline, which carries Canadian crude to the United States, likely was the source of an oil spill in Missouri that prompted the company to shut a segment of the line.
“Preliminary investigation has led TransCanada to believe that the oil discovered in St. Charles County likely originates from the Keystone Pipeline system,” company spokesman Terry Cunha said in an e-mail Feb. 8. TransCanada declared force majeure on some shipments Feb. 7 after the leak was discovered Feb. 6.
The disruption comes as Gulf Coast refiners seek alternatives to heavy crude after sanctions on Venezuela effectively cut off access to the country’s oil. Canada’s oil-sands crude serves as a similar substitute, but Alberta has struggled with pipeline bottlenecks that have forced rationing on export pipelines and prompted the province to impose mandatory production curtailments.
The 43-barrel oil leak had prompted Enbridge Inc. to shut its nearby Platte crude line, pending investigation. A portion of the line was returned to service Feb. 7, and normal operations resumed early Feb. 9.
Prices for heavy Western Canadian Select crude have weakened since the two pipes were shut. Western Canadian Select traded at an $11-a-barrel discount to the U.S. benchmark Feb. 8, compared with a $9-a-barrel discount before the leak.
The 590,000 barrel-a-day Keystone line is an important conduit for Alberta heavy crude to reach U.S. refiners. A segment of the line running from Steele City, Neb., to Patoka, Ill., remains shut, with no estimate for restart. The Hardisty-to-Steele City and Steele City-to-Cushing, Okla., segments are running, according Genscape Inc.
TransCanada has approximately 75 people on site to continue to excavate and safely expose the pipeline segment of concern. They continue to affirm there is no threat to public safety or the environment, Cunha said. The excavation likely won’t be completed until Feb. 17, according to the Pipeline and Hazardous Materials Safety Administration.
The spill is the second attributed to Keystone in just over a year.
