Investigators and clean-up crews begin searching for buried oil pipelines in Kansas

WASHINGTON, Kansas, Dec 9 (Reuters) – Emergency crews prepared on Friday to work throughout the weekend to clean up the biggest US crude oil spill in nearly a decade, with Mississippi workers pouring into this farming community.

According to a Reuters witness, a strong smell of oil hung in the air as tractor trailers hauled generators, lighting and floor mats to a muddy spot. Federal investigators were at the scene trying to determine what caused a leak of about 14,000 barrels of oil from western Canada, an official said.

Pipeline operator TC Energy (TRP.TO) said Friday it was reviewing plans to restart the line, which transports 622,000 barrels of oil per day to US refineries and export centers. No details were given about the injury or the start of a restart.

The outage could affect oil supplies at the Cushing, Oklahoma storage center and cut crude oil supplies to refinery centers in the mid-US and Gulf Coast, analysts said.

“We’re starting to get a better sense of the cleanup that needs to be done over the longer term,” said Kellen Ashford, spokeswoman for EPA Region 7, which includes Kansas.

Environmental specialists worked in near-freezing temperatures, and crews set up equipment so operations could continue for days.

TC Energy intends to restart a section of the pipeline that sends oil to Illinois on Saturday and another section that brings oil to Cushing on Dec. 20, Bloomberg News reported, citing sources. Reuters has not verified these details.

This is the third spill of several thousand barrels of crude oil on the pipeline since it opened in 2010. A previous Keystone spill caused the pipeline to remain closed for about two weeks.

TC Energy stayed on site with about 100 workers leading the cleanup and containment efforts, and the EPA provided oversight and monitoring, Ashford said. TC is responsible for determining the cause of the leak.

The US regulator Pipeline and Hazardous Materials Administration said the company shut down the pipeline seven minutes after receiving a leak detection alert. The affected 36 inch (91 cm) diameter segment was Keystone’s Phase 2 extension to Cushing, built in 2011.

Washington County, a rural area with a population of about 5,500, is located about 200 miles northwest of Kansas City.

The spill did not threaten local water supplies or forced residents to evacuate, Washington County emergency management coordinator Randy Hubbard told Reuters. Workers quickly set up a containment area to prevent oil that had spilled into a creek from flowing downstream.

“There is no human drinking water that would come out of it,” Hubbard said.

Ranchers in the area have been notified and have taken their own corrective actions to protect their animals, he added.

The EPA is the primary federal agency that monitors domestic oil spills. If the EPA determines that TC Energy is responsible for the spill, the company would be responsible for the cost of cleaning up and repairing environmental damage, as well as potential civil and criminal penalties.

According to Zygmunt Plater, a professor of environmental law at Boston College Law School, pipeline operators are typically held accountable for violations by the EPA through the Clean Water Act (CWA) and related Oil Pollution Act.

These federal laws limit the discharge of pollutants like oil into waterways and hold pipeline operators responsible for the costs associated with containment, clean-up and damage from spills.

Raw Bottleneck

A prolonged pipeline shutdown could also cause Canadian crude to become bottlenecked in Alberta, driving prices lower at the Hardisty storage center, although price reaction was muted on Friday.

Western Canada Select (WCS), the benchmark Canadian heavy grade, was last trading at a $27.70 per barrel discount to the US crude futures benchmark for December delivery, according to a Calgary-based broker. On Thursday, December, WCS traded as low as $33.50 below US Crude Oil before settling at a discount of around $28.45.

PHMSA must approve the line’s return to service. Even if the pipeline is brought back into service, the affected area will have to flow at reduced rates pending approval by the PHMSA.

“The real impact could come if Keystone faces pressure restrictions from PHMSA, even after the pipeline is allowed to resume operations,” said Ryan Saxton, head of oil data at Wood Mackenzie.

Reporting by Erwin Seba in Washington, Kansas; Additional reporting by Arathy Somasekhar, Rod Nickel, Stephanie Kelly and Clark Mindock; Edited by Marguerita Choy and Daniel Wallis

Our standards: The Thomson Reuters Trust Principles.

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