Canadian pipelines shut down after leak

Portions of

Keystone oil pipeline and

Platte pipeline remained shut on Thursday for investigation of a leak in the St. Louis area, officials said.

TransCanada shut the Keystone pipeline down on Wednesday between Steele City, Neb., and Patoka, Ill., and dispatched crews to assess the situation, spokesman Terry Cunha said.

The 590,000-barrel-perday Keystone pipeline is a critical artery taking Canadian crude from northern Alberta to U.S. refineries. Canadian pipelines are already congested, due to expanding production in recent years, forcing the Alberta provincial government to order production cuts starting last month.

Part of the Platte crude pipeline, operated by an Enbridge affiliate, was also shut, while other sections were open as of Thursday afternoon, spokesman Devin Hotzel said.

The pipeline transports up to 164,000 bpd of crude oil from Casper, Wyo., to Guernsey, Wyo., and 145,000 bpd from Guernsey to Wood River, Ill.

Canadian heavy oil has attracted greater demand in recent days due to U.S. sanctions against Venezuela’s state oil company.

RELEASE WAS CONTAINED TO AN AREA OF ... 4,000 SQUARE FEET.

The discount on Canadian heavy crude compared to U.S. light oil widened to US$10.25 per barrel on Thursday afternoon from US$9.40 earlier, according to Net Energy Exchange.

TransCanada shares eased 0.4 per cent to $55.88 in Toronto while Enbridge shares slipped 0.4 per cent to $49.22.

A spokesman for the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration could not be immediately reached.

A Missouri Department of Natural Resources official said the source of the leak had not yet been identified and the quantity of oil from the release is still unknown.

“The release was contained to an area of approximately 4,000 square feet ... excavation of the containment area will begin soon or is already in progress,” the official said in an email.