Federal agency shuts down Canada's Keystone pipeline

WASHINGTON -- The U.S. pipeline safety agency Friday blocked a Canadian company from restarting its Keystone oil pipeline until U.S. officials are satisfied the company has made required repairs and completed safety tests.

The order by the Pipeline and Hazardous Materials Safety Administration cites two leaks last month on the 1,300-mile pipeline, which carries oil from Canada through North Dakota, South Dakota and Nebraska. One arm then travels through Missouri to Illinois, while another goes through Kansas to Oklahoma.

A spokeswoman for the pipeline agency said Friday that federal inspectors will closely review repair work done by the pipeline's owner, Calgary-based TransCanada Corp. The company reported a May 7 leak of about 400 barrels in North Dakota, and a leak of about 10 barrels last Sunday in Kansas.

TransCanada is seeking to build a second pipeline from western Canada to the Texas Gulf Coast -- a project that has drawn fierce opposition from environmental groups who call the pipeline an ecological disaster waiting to happen.

The proposed pipeline, like the existing pipeline, would carry crude oil extracted from tar sands in Alberta, Canada, to refineries in the U.S.

Critics say the tar sands produce "dirty oil" that requires huge amounts of energy to extract, while supporters say the two pipelines would create thousands of jobs and help cut $4-a-gallon prices at the pump.