TransCanada Says Keystone Pipe Shut After Pump Station Leak

TransCanada Corp. (TRP) shut its 591,000- barrel-a-day Keystone crude pipeline after “an issue with a fitting” caused an oil leak at a pump station, the company said in an e-mailed statement.

About 40 barrels spilled within the pump facility a few minutes after midnight local time on May 29 after a 1/2-inch segment broke, said Terry Cunha, a Calgary-based company spokesman. The facility is in Doniphan County, Kansas, about 60 miles (97 kilometers) northwest of Kansas City, Missouri, he said. There’s no schedule for when the system will resume operations, he said.

“It was a fitting that broke that resulted in oil spilling within the facility but it was all contained on site,” Cunha said in a telephone interview. “The system is shut down and no oil will be delivered until we completely repair the pump station. We don’t know when the actual start date will be.”

This is the second time in a month that Keystone has closed because of a leak at a pump station. A May 7 incident resulted in a spill of 500 barrels of crude in North Dakota and closed the line for about one week.

Inspectors are investigating the cause of the failure, Julia Valentine, a spokeswoman for the U.S. Department of Transportation, said in an e-mail today. “The investigation will examine if there are similarities between this weekend’s failure and any prior failures on the system, including the incident which occurred on May 7, 2011,” she said.

Shippers ‘Not Affected’

Shippers on the line haven’t been affected by the shutdown and the company anticipates that it will be able to make deliveries for May, said Cunha.

“It’s an issue we’re definitely trying to figure out,” he said. “We’re working with all the appropriate agencies to figure out a restart plan and to investigate the cause of the fittings continuing to break. We’ve demonstrated that these incidences aren’t affecting the integrity of the pipeline but are happening at the pump stations where we have a lot of moving parts and machines.”

Keystone extends 2,151 miles from Hardisty, Alberta, to U.S. markets at Patoka, Illinois. The system started in February a Phase II extension to Cushing, Oklahoma, the delivery point for crude futures contracts traded in New York.

To contact the reporters on this story: Aaron Clark in New York at aclark27@bloomberg.net; Christian Schmollinger in Singapore at christian.s@bloomberg.net

To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net

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