Keystone Pipeline hit with proposed massive multi-million dollar fine

Published July 13, 2026 12:01 PM MST

FILE - The United States Environmental Protection Agency in Washington DC. (Photo by: Loop Images/Universal Images Group via Getty Images)

The Keystone Pipeline system’s operator could be ordered to pay millions for a major oil spill in Kansas in December 2022 and spend millions more to prevent future accidents, according to a proposed legal settlement with the U.S. government.

Dig deeper:

The agreement would resolve allegations from the U.S. Environmental Protection Agency and Kansas that South Bow, Keystone’s operator 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.

By the numbers:

The settlement proposes that Keystone pay a $26.9 million civil penalty, as well as potentially spending another $40 million to prevent more accidents. 

South Bow could also pay Kansas more than $3 million for environmental restoration projects.

The backstory:

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.

No pipeline workers or area residents were injured in the spill, and officials said public water supplies weren’t affected. However, a complaint filed Friday by the U.S. government along with the proposed settlement said more than 2,700 animals were harmed or killed. The area is home to an endangered species, the long-eared bat.

The Source: Information for this article was taken from The Associated Press. 

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