The Keystone Operator Must Repay Some — Not All — of the Tax Dollars Spent on its Kansas Oil Spill

Washington, KS- When the Keystone pipeline burst in rural Kansas last month, county workers rushed to build an emergency dam on Mill Creek.

Meanwhile, federal agencies dispatched pipeline and environmental experts to the scene.

And the state set about sampling water and searching for injured animals.

All of this costs taxpayers — from transporting and housing workers to cladding them in waders that require special disposal because the gear becomes permanently contaminated.

TC Energy, the Canadian company behind the spill, will have to repay some, but not all, of the public money spent on handling it.

This week, several government agencies expressed confidence that they will ultimately recover their expenses.

In the case of the federal and state governments, laws and binding orders apply.

Washington County emergency manager Randy Hubbard said that he isn’t aware of any laws that require TC Energy to reimburse a local government, but the company has vowed to do so.

“From day one TC Energy has been very adamant and forthcoming about offering to cover any County related expenses,” he said in an email, “including but not limited to labor, resources or materials.”

TC Energy reported an annual revenue of more than $13.3 billion and a net income of more than $2 billion in its most recent yearly report.

The Keystone is the company’s biggest pipeline system for oil and carries crude from Canada to refineries in the Midwest and the Gulf Coast. The system has spilled numerous times, but the rupture in Kansas that released an estimated 588,000 gallons of tar sands crude oil was the biggest spill to date.

State and federal expenses


A wide array of government agencies responds to inland oil spills.

At least two Kansas agencies say they can get TC Energy to reimburse for their efforts responding to the spill.

By state law, TC Energy must repay the Kansas Department of Health and Environment. If the company fails to pay, the same law instructs the attorney general to sue.

The Kansas Department of Wildlife and Parks said it, too, will recuperate its costs. The agency is tracking staff time, mileage and equipment.

The federal government, meanwhile, could rack up costs not just through the U.S. Environmental Protection Agency, but also for support from the U.S. Fish and Wildlife Service, the U.S. Army Corps of Engineers, the National Oceanic and Atmospheric Administration, the U.S. Department of Transportation and more.

Some of that spending of tax dollars will get repaid.

A photo shows federal workers at the Keystone spill site.
Environmental Protection Agency Federal environmental and pipeline safety specialists at the site of the oil spill on Dec. 13, 2022.

This month, TC Energy agreed to an EPA order that binds the company to reimburse direct and indirect costs within 30 days of being billed.

That includes, for example, the federal government monitoring TC Energy workers and contractors pulling oil from the creek. And the reimbursement order applies retroactively to costs dating back to the spill more than a month ago.

But other federal activities fall outside the order — such as sending pipeline safety enforcers to Washington County.

USDOT’s Pipeline and Hazardous Materials Safety Administration said it doesn’t have the authority to seek reimbursement.

County government expenses

The county has already submitted documentation of its costs to the company, Hubbard said. (The Kansas News Service has filed a public information request for the records.)

County emergency workers provided boots on the ground critical to a swift response.

At about 12:30 a.m. on Dec. 8, TC Energy called in a possible leak to a federal hotline for oil spills. By about 1:30 a.m., Hubbard and the county’s road supervisor got involved. The county worked with the company to dam Mill Creek, where thousands of barrels of oil were sliding downstream.

“A better part of the first day was spent building this dam,” Hubbard said in an email. “Additionally, our Road and Bridge crew spent a better part of the first 2 days putting down rock and prepping/grooming roads in the immediate area to better support the anticipated arrival of heavy equipment for the response.”

Hubbard praised TC Energy’s efforts, saying he had witnessed its commitment to remediating the area, keeping workers safe and communicating with landowners.

“TC Energy has been great to work with throughout the entirety of this unfortunate event,” he said. “Additionally, TC Energy has used, and continues to use local contractors whenever possible.”

The company announced it would donate $7,500 to equip local emergency responders with better mobile and radio equipment. It also said it would match donations made by the public to Washington County Hospital.

More about the oil spill

Here are more details about the spill.

1. State environment officials are now finding less benzene and other chemicals downstream from the four-mile stretch of creek that TC Energy isolated last week.

That stretch had already been dammed to hold back floating oil but water continued to flow downstream beneath the surface. As of last week, TC Energy is temporarily diverting water from upstream of the spill, allowing it to bypass and seal off four miles of stream while the cleanup continues.

This week, the state announced that contamination is decreasing downstream in Mill Creek and the river it feeds into, the Little Blue. However, it says people shouldn’t touch Mill Creek anywhere downstream of the spill site. They should keep their pets and livestock away, too.

The Kansas News Service has asked the state for the results of weekly water sampling.

Families who rely on private wells in the area or who use water from Mill Creek or the Little Blue for livestock and ponds can ask TC Energy to test their water. (Email or call 1-855-920-4697.)

A map shows where TC Energy has diverted Mill Creek to avoid a four-mile stretch that needs intensive cleanup.
TC Energy This map shows where TC Energy will divert Mill Creek to avoid a four-mile stretch that needs intensive cleanup.

2. Oil-soaked animals get treated at a rehabilitation shelter.

“This area is heated, covered, protected, and staffed by a team of wildlife rehabilitation professionals and biologists,” a spokesman for the EPA said by email. “The lead in this response has over 20 years of experience in wildlife rehabilitation and oiled wildlife response.”

Reporters have not been allowed to visit the spill site or the animal rehabilitation shelter, or interview the Fish and Wildlife Service, which works on wildlife matters at the site.

The total number of dead animals isn’t clear, but includes at least one beaver that succumbed despite attempts to treat it.

Scores of fish died, even though oil spills in water bodies generally don’t take the same toll on fish as they do on turtles, birds and mammals that penetrate the oil slick to enter and leave the water. Scientists say the impact on fish increases when oil spills happen in shallow water.

3. Neither the state nor the federal government have released photos of injured, dead or rehabilitated animals that the Kansas News Service has asked for. Kansas says it is withholding the photos because it is investigating the oil spill.

4. TC Oil signed a consent order this month with the EPA that requires it to clean up Mill Creek and its banks.

The company has to recover the spilled oil from the creek and its banks, and remove contaminated soil and plants that could lead to more chemicals reaching the water.

This oil recovery has to continue until the EPA and Natural Resource Trustee Agencies agree the company is finished.

TC Energy also has to monitor for contamination downstream, but the order doesn’t specify what methods it should use. The Keystone spilled dilbit in Kansas, a special product from the Canadian tar sands that doesn’t behave like traditional crude oil. A National Academies of Sciences study found little in the way of reliable options to detect dilbit once it begins moving below the surface in moving water.

The federal consent order makes no mention of special requirements related to cleaning up dilbit, though top scientists have urged the federal government to change its policies and procedures to distinguish dilbit spills from regular crude oil spills.

5. It’s unclear whether the federal government considers the consent order to apply to the entire spill site.

When the pipeline burst, it spewed crude oil into the air that splattered across acres of agricultural land, in addition to the oil that poured into the creek.

The Kansas News Service asked whether the EPA’s consent order applies to all land affected by the spill, not just the creek and its banks.

The EPA replied: “The current order is issued pursuant to the Clean Water Act. It requires the Respondent to conduct removal actions to abate and mitigate the imminent and substantial threat to Mill Creek and adjoining shorelines that is presented by the discharge of oil from the ruptured pipeline.”

But the EPA added that it “continues to coordinate with KDHE on a comprehensive cleanup strategy.”

The EPA also says KDHE may require TC Energy to perform work “that is beyond EPA’s Clean Water Act authority.”

Read more about the Keystone spill in Kansas:


Celia Llopis-Jepsen is the environment reporter for the Kansas News Service. You can follow her on Twitter @celia_LJ or email her at celia (at) kcur (dot) org.

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