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 spillage of nearly 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 US for Clean Water Act violations.
In addition to the penalty, South Bow has committed to investing around $40 million US in preventive measures to avoid similar incidents in the future. The company will also allocate $3 million US for natural resource restoration projects to address state law violations.
The Justice Department highlighted that this incident was one of the largest inland oil spills in recent history and the biggest from the Keystone pipeline system, which stretches from Hardisty, Alberta, to Port Arthur, Texas. Adam Gustafson, deputy assistant attorney general, emphasized the importance of the company’s pledge to prevent future leaks.
The Environmental Protection Agency’s assistant administrator, Jeffrey Hall, emphasized the necessity of proper pipeline maintenance, citing the severe impact of the oil spill on land and water resources. The spill, which covered Mill Creek with crude oil more than two centimetres thick for 5.6 kilometres, resulted in the death or harm of over 2,700 animals.
South Bow stated that it took proactive corrective actions even before receiving formal directives from U.S. authorities, including completing site cleanup by February 2024. The company spokesperson, Sara Hunter, mentioned ongoing efforts to enhance pipeline integrity through inspections and remedial work.
Formerly owned by TC Energy Corp., the pipeline faced previous spills, with an incident in April 2025 resulting in the spillage of approximately 3,500 barrels in North Dakota. South Bow is planning to expand its cross-border crude pipeline system, with initiatives like the Prairie Connector project that aims to utilize existing infrastructure for enhanced connectivity.