The U.S. Department of Justice has settled with South Bow Corp., a pipeline company, over a rupture in the Keystone pipeline in 2022 that resulted in the spill of around 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 related to Clean Water Act violations.
Additionally, South Bow has committed to investing approximately $40 million to implement preventative measures to avoid similar incidents in the future. The company will also contribute $3 million towards natural resource restoration projects in the state to address violations of state laws.
The Justice Department highlighted that this oil spill was one of the largest inland incidents in recent history and the most significant from the Keystone pipeline system, stretching from Hardisty, Alberta, to Port Arthur, Texas. Adam Gustafson, deputy assistant attorney general, emphasized the importance of the company’s pledged efforts to prevent future leaks.
According to Jeffrey Hall, assistant administrator at the U.S. Environmental Protection Agency, the case serves as a reminder of the critical need to maintain pipelines properly. The spill caused significant environmental damage, with crude oil covering Mill Creek extensively and impacting wildlife, resulting in the death or harm of over 2,700 animals.
South Bow stated that it proactively took corrective actions before receiving formal directives from U.S. authorities, including completing site cleanup by February 2024. The company has undertaken comprehensive inspections and remedial work to enhance the integrity of its pipeline system.
Initially owned by TC Energy Corp., the pipeline experienced previous spills, including one in North Dakota in April 2025. South Bow has future plans to expand its cross-border crude pipeline network, such as the Prairie Connector project, which aims to utilize existing infrastructure from the abandoned Keystone XL expansion project. This initiative would connect to a proposed pipeline by Bridger Pipeline LLC from the Canada-U.S. border to Wyoming.
