Natalie Wallington
Fri, March 10, 2023
A large segment of the Keystone Pipeline, including the site of December’s massive oil spill in rural northern Kansas, will face increased regulations following an order from the U.S. Department of Transportation.
Regulators have ordered Keystone Pipeline operator TC Energy to reduce pressure and conduct safety testing on an over-1,000 mile long segment of the pipeline stretching from the Canadian border down to Oklahoma.
The segment includes the site of a failure three months ago near Washington, Kansas, which spilled more oil than all of the pipeline’s previous ruptures combined.
Continuing to operate the segment “is or would be hazardous to life, property, or the environment” unless changes are made, Tuesday’s order states.
Regulators with the Pipeline and Hazardous Materials Safety Administration (PHMSA) laid out ten requirements for TC Energy to follow under threat of “civil penalties” or legal action. The requirements include:
Reducing the pipeline’s operating pressure temporarily
Mechanical testing of the failed pipeline section and of welds similar to the one that failed in December’s spill
Analyze whether land movement played a role in December’s rupture
Present a plan on how the company will update its safety protocols to prevent future spills
“I would suggest that PHMSA has Keystone’s attention,” said Richard Kuprewicz, an independent pipeline advisor who has testified before Congress on pipeline safety and has over 20 years of experience advising on pipeline operation and regulation.
He added that the order’s restrictions may help prevent future ruptures.
“The independent forensic report would likely indicate a possible systemic issue that needs to be addressed,” he said.
You can view the full text of the order below. If you can’t see the embed, click here to view the document.
Department of Transportation order on Kansas pipeline spill by The Kansas City Star on Scribd
What caused December’s Keystone Pipeline spill?
TC Energy released a report in February, just over two months after the initial spill, ascribing the rupture to “bending stress on the pipe” and “a weld flaw.”
The Department of Transportation’s order Tuesday offered more insight into the potential causes of these issues. Specifically, the order seemed to single out land movement as a potential cause of bending stress on the pipe.
“Onsite personnel observed the failed segment move vertically as overburden was removed, indicating the pipeline was under improper loading and stress,” the order read. “It is not clear whether the pipe segment has been under stress since construction or if land movement in the area may have more recently induced or increased stress.”
While regulators note that TC Energy was monitoring the area for “geohazards and land movement” prior to the failure, they ordered the company to get its monitoring program reviewed by a third-party evaluator in the next 60 days.
“The evaluation must determine if land movement may have contributed to the loading and stresses on the pipeline at the failure location,” regulators added.
“Land movement” can be caused by extreme weather, erosion, geological shifts due to climate change or earthquakes. It is one of many factors that can put stress on oil pipelines, especially those located on slopes, according to PHMSA.
The agency released updated guidance last June advising pipeline operators to take special precautions against the impacts of land movement. It listed recommendations, but did not require new safety measures of pipeline operators.
What does the federal order mean for future Keystone spills?
Regulators noted that the Keystone Pipeline has been spilling more oil more often in recent years, a trend it hopes new regulations will reverse.
“The spills… show a tendency or pattern in recent years of increasingly frequent incidents resulting in larger releases,” the order states.
An EPA spokesperson declined to comment on the recent order.
The pipeline segment covered by the order, which extends from the U.S.-Canada border in the north to Cushing, Oklahoma in the south, must remain at a lower operating pressure until TC Energy meets its other requirements.
The company has around 90 days to meet most of the requirements in the order, although it can request time extensions if it has a “good cause,” the order says.
CERAWEEK-Keystone pipeline oil flows won't change after US order to cut pressure, CEO says
A supply depot servicing the Keystone XL crude oil pipeline lies idle in Oyen
Thu, March 9, 2023
By Stephanie Kelly and Simon Webb
HOUSTON (Reuters) - Oil flows on TC Energy's Keystone pipeline will not change after the U.S. pipeline regulator said it would require the company to reduce pressure following a 13,000-barrel oil spill in Kansas in December, Chief Executive François Poirier told Reuters on Thursday.
Keystone has already been operating within the requirements of the new order from the Pipeline and Hazardous Materials Safety Administration (PHMSA), Poirier said in an interview. The Canadian pipeline operator completed a controlled restart of the 622,000-barrel-per-day (bpd) pipeline to Cushing, Oklahoma, on Dec. 29 last year, returning it to service after a 21-day outage following the biggest U.S oil spill in nine years.
Before the order, "we had the ability to meet the entirety of our contractual commitments of 594,000 bpd and so obviously that remains the same," Poirier told Reuters on the sidelines of the CERAWeek energy conference in Houston.
The PHMSA said on Tuesday it would require TC Energy to reduce operating pressure on more than 1,000 additional miles (1,609 kms) of Keystone.
Though an analysis has not been completed, Poirier said the company recently has indicated in disclosures that the spill was caused by issues around the girth weld on the pipeline combined with stress on the line.
Poirier said the Canadian company has not changed its estimate of $480 million in costs related to the incident.
PERMITS AND RENEWABLES
TC Energy has a $34 billion backlog of projects for the next few years, Poirier said, adding most of those projects are natural gas.
The company is not concerned that permitting challenges will impede those projects, he added. Challenges of getting permits for energy infrastructure have been a big theme for oil and gas executives at the conference.
"In 2022, we put $6 billion of infrastructure into service," Poirier said. "In 2023, it's nearly the same amount, so that is the best proof that you can actually sanction and build infrastructure in North America."
The permitting process to develop so-called greenfield projects, or projects on undeveloped land, typically takes an additional year than projects on already developed land, Poirier said.
TC Energy has also had issues with labor availability. Canada's construction labor market typically is between 8,000 to 10,000 workers, but right now there are almost 20,000 workers in Canada to help build out various energy projects, Poirier said.
"That has resulted in significant inflation, as well as lower productivity because you're bringing more inexperienced workers into the market," he said.
TC Energy is involved with a push from Canada's main oil-producing province Alberta to develop the country's first carbon storage hubs. A TC Energy joint-venture project with Pembina Pipeline Corp was one of six proposals selected by Alberta to move forward in the development.
Poirier estimates TC Energy will start burying carbon dioxide in Alberta in the second half of the decade, with aims to put infrastructure into service around 2027 or 2028, Poirier told Reuters.
Previously, TC Energy announced plans to lower its emissions by switching to renewable energy to run its huge network of U.S. and Canadian oil and gas pipelines.
Poirier said the company was on course to deliver on its target to divest C$5 billion of assets by the end of the year.
Poirier added that the company saw plenty of opportunity for growth both in fossil fuels and in new energy projects.
"Our challenge is what not to do. We have to learn how to evolve our portfolio over the course of the next decade," he said.
(Reporting by Stephanie Kelly and Simon Webb; Editing by David Gregorio)
A supply depot servicing the Keystone XL crude oil pipeline lies idle in Oyen
Thu, March 9, 2023
By Stephanie Kelly and Simon Webb
HOUSTON (Reuters) - Oil flows on TC Energy's Keystone pipeline will not change after the U.S. pipeline regulator said it would require the company to reduce pressure following a 13,000-barrel oil spill in Kansas in December, Chief Executive François Poirier told Reuters on Thursday.
Keystone has already been operating within the requirements of the new order from the Pipeline and Hazardous Materials Safety Administration (PHMSA), Poirier said in an interview. The Canadian pipeline operator completed a controlled restart of the 622,000-barrel-per-day (bpd) pipeline to Cushing, Oklahoma, on Dec. 29 last year, returning it to service after a 21-day outage following the biggest U.S oil spill in nine years.
Before the order, "we had the ability to meet the entirety of our contractual commitments of 594,000 bpd and so obviously that remains the same," Poirier told Reuters on the sidelines of the CERAWeek energy conference in Houston.
The PHMSA said on Tuesday it would require TC Energy to reduce operating pressure on more than 1,000 additional miles (1,609 kms) of Keystone.
Though an analysis has not been completed, Poirier said the company recently has indicated in disclosures that the spill was caused by issues around the girth weld on the pipeline combined with stress on the line.
Poirier said the Canadian company has not changed its estimate of $480 million in costs related to the incident.
PERMITS AND RENEWABLES
TC Energy has a $34 billion backlog of projects for the next few years, Poirier said, adding most of those projects are natural gas.
The company is not concerned that permitting challenges will impede those projects, he added. Challenges of getting permits for energy infrastructure have been a big theme for oil and gas executives at the conference.
"In 2022, we put $6 billion of infrastructure into service," Poirier said. "In 2023, it's nearly the same amount, so that is the best proof that you can actually sanction and build infrastructure in North America."
The permitting process to develop so-called greenfield projects, or projects on undeveloped land, typically takes an additional year than projects on already developed land, Poirier said.
TC Energy has also had issues with labor availability. Canada's construction labor market typically is between 8,000 to 10,000 workers, but right now there are almost 20,000 workers in Canada to help build out various energy projects, Poirier said.
"That has resulted in significant inflation, as well as lower productivity because you're bringing more inexperienced workers into the market," he said.
TC Energy is involved with a push from Canada's main oil-producing province Alberta to develop the country's first carbon storage hubs. A TC Energy joint-venture project with Pembina Pipeline Corp was one of six proposals selected by Alberta to move forward in the development.
Poirier estimates TC Energy will start burying carbon dioxide in Alberta in the second half of the decade, with aims to put infrastructure into service around 2027 or 2028, Poirier told Reuters.
Previously, TC Energy announced plans to lower its emissions by switching to renewable energy to run its huge network of U.S. and Canadian oil and gas pipelines.
Poirier said the company was on course to deliver on its target to divest C$5 billion of assets by the end of the year.
Poirier added that the company saw plenty of opportunity for growth both in fossil fuels and in new energy projects.
"Our challenge is what not to do. We have to learn how to evolve our portfolio over the course of the next decade," he said.
(Reporting by Stephanie Kelly and Simon Webb; Editing by David Gregorio)
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