Keystone Pipeline system's operator agrees to pay $26.9M penalty over major Kansas oil spill

By — John Hanna, Associated Press John Hanna, Associated Press Leave your feedback Share Copy URL https://www.pbs.org/newshour/nation/keystone-pipeline-systems-operator-agrees-to-pay-26-9m-penalty-over-major-kansas-oil-spill Email Facebook Twitter LinkedIn Pinterest Tumblr Share on Facebook Share on Twitter Keystone Pipeline system's operator agrees to pay $26.9M penalty over major Kansas oil spill Nation Jul 12, 2026 2:33 PM EDT TOPEKA, Kan. (AP) — A proposed legal settlement with the U.S. government would require the Keystone Pipeline system's operator to pay a $26.9 million civil penalty over a major oil spill in Kansas in December 2022 and spend about $40 million more to prevent future accidents. The agreement would resolve allegations from the U.S. Environmental Protection Agency and Kansas that South Bow, based in Canada, violated U.S. and state clean water laws. The rupture dumped nearly 13,000 barrels of heavy crude oil into a creek running through a rural pasture in Washington County, Kansas, about 150 miles (241 kilometers) northwest of Kansas City. READ MORE: Keystone pipeline shuts down after oil spill in Kansas creek The accident was the largest onshore crude pipeline spill in the U.S. in nine years and surpassed all 22 previous ones on the same pipeline system combined, according to a 2021 report from the U.S. Government Accountability Office. The total amount of oil spilled would have nearly filled an Olympic-sized swimming pool. South Bow also would pay Kansas more than $3 million for environmental restoration projects under a proposed decree filed Friday in U.S. District Court in Kansas. A judge would have to approve the proposal after a 30-day public comment period. South Bow has disputed the government's allegations and does not acknowledge any legal liability. The proposed agreement said both parties are avoiding litigation and the settlement would be "fair, reasonable and in the public interest." "The oil spill blanketed land and water, rendering the waterway lifeless and useless and requiring extensive cleanup and remediation," Jeffrey Hall, the EPA's assistant administrator for its enforcement office, said in a statement. "The substantial penalty reflects the seriousness of the environmental harm." READ MORE: Keystone oil spill in Kansas is largest in pipeline's history, federal data shows South Bow officials did not respond immediately Sunday to a phone message and email seeking comment, but the company told The Canadian Press that it "proactively" began cleaning up the area before receiving directives from U.S. officials. The cleanup was completed early in 2024. The company that built the pipeline, TC Energy, spun off South Bow as a separate firm in 2024, after the Kansas cleanup was done. No pipeline workers or area residents were injured, and officials said public water supplies weren't affected by the spill. However, a complaint filed Friday by the U.S. government along with the proposed settlement said more than 2,700