Following a temporary shutdown, TC Energy’s Keystone oil pipeline has resumed operations, marking the restoration of a crucial conduit for Canadian oil to the United States. The pipeline, capable of transporting 622,000 barrels per day, encountered issues, including a spill in rural Kansas last year.
In a statement released late afternoon, TC Energy confirmed that the Keystone pipeline is now safely back in service after a precautionary suspension. The company assured that the pipeline’s integrity has been verified, with no oil leakage reported during the shutdown period.
Earlier, TC informed shippers about the outage due to operational concerns without specifying details, according to industry sources. The company did not disclose the extent of the Keystone network that was affected or the duration of the shutdown.
The resumption of Keystone’s operations had an impact on oil prices, with U.S. West Texas Intermediate crude registering a 0.4% increase to $79.22 per barrel once trading resumed. Rory Johnston, founder of the Commodity Context newsletter, highlighted the recurrent nature of sporadic outages with the Keystone pipeline, underscoring the delicate balance of crude oil transportation capacity in Western Canada.
Stretching over 4,850 km (3,000 miles), the Keystone pipeline carries oil from Alberta to Nebraska, where it bifurcates to serve the Midwest and U.S. crude storage hub in Cushing, Oklahoma, as well as refineries in the Gulf region.
Despite recent challenges, TC Energy remains committed to ensuring the integrity of the Keystone system. Executives have conducted thorough inspections following the Kansas spill in 2022 and reported no potential issues affecting the pipeline’s reliability.
While Keystone plays a significant role in Canadian oil transportation, Enbridge’s Mainline serves as a primary alternative. Enbridge’s Mainline is currently operating with 25% apportionment for light oil and 20% for heavy oil in March.
The recent outage underscored the importance of infrastructure developments like the Trans Mountain pipeline expansion, set to alleviate pipeline congestion by significantly increasing capacity for transporting oil from Alberta to the British Columbia coast.
TC Energy’s decision to spin off its liquids business, including Keystone, reflects its strategic focus on natural gas transportation and ongoing efforts to reduce debt through asset sales.