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Keystone Pipeline Leaks Thousands of Gallons of Oil Into S. Dakota

TransCanada says it has received conditional approval to restart its Keystone Pipeline after identifying the source of a small leak in South Dakota. The company expects the pipeline to be operational by Saturday night. At first officials said fewer than 200 gallons were spilled. CNN quotes TransCanada as stating it hasn’t “observed significant impacts to the environment” from the leak.

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On April 7, Transcanada reported the incident to the National Response Center and the Pipeline and Hazardous Materials Administration as required by law.

Phillips’ Wood River, Illinois, plant has shut down a 64 000 bpd sour crude unit and a 16 000 bpd coker due to the disruption in supply.

Oil covered a 300-square-foot area in a farm field ditch 4 miles from a Freeman-area pump station, about 40 miles southwest of Sioux Falls.

There are about 100 workers at the site working around the clock to pinpoint the source of the leak in the pipeline.

A TransCanada spokesman confirmed in an email that the company had informed customers during a subsequent call on Wednesday afternoon that next Tuesday remained the best-case scenario for a restart.

“One of the things we don’t know is exactly how long the line is going to be down and we don’t know the extent of the spill”, Lipow said.

TransCanada’s Keystone I pipeline carries light and heavy crude from Hardisty, Alberta to refineries in IL and Oklahoma, while passing through the eastern Dakotas, Nebraska, Kansas and Missouri.

This week’s shutdown of the Keystone oil pipeline has stopped up the route for roughly a quarter of the crude flowing into the U.S. Midwest.

He said TransCanada will also have to look at its practices and leak monitoring systems to determine why it didn’t detect the leak.

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The spill comes five months after the federal government rejected TransCanada’s proposal to build their Keystone XL oil pipeline, which would have passed through western South Dakota, amid environmental fears.

UPDATE 2-TransCanada delays restart of Keystone crude pipeline to Tuesday -traders