Enterprise's Seaway Crude pipeline system shut after Cushing, Oklahoma spill

(Reuters) - A leak late on Sunday prompted Enterprise Products Partners to shut its Seaway Crude Pipeline system, the largest conduit for moving oil from the major storage hub in Cushing, Oklahoma to Gulf coast refineries.

News of the leak dragged U.S. crude prices lower on Monday on worries that shutting down the 850,000 barrel-per-day (bpd) Seaway system would bottle up barrels in storage in Cushing, the delivery point for the benchmark West Texas Intermediate (WTI) futures contract.

U.S. crude futures slipped 1.3 percent in afternoon trading, while international benchmark Brent crude futures fell about 1.2 percent.

Enterprise said on Monday it had shut down the 400,000-bpd pipeline, which it calls its legacy line, but did not provide an estimate of the volume spilled. The total amount released would not be determined until recovery efforts were complete, the company said.

The company on Monday afternoon said it had restarted its 450,000 bpd Seaway Twin, which was shut as a precaution.

Most of the oil released was contained in a retention pond at a facility belonging to Enbridge Inc, a joint owner of the Seaway Crude Pipeline Company with Enterprise.

Enterprise said there was no threat to the public and no evacuations were ordered following the spill, located near the intersection of Linwood Avenue and Texaco Road in Cushing.

The company was working with emergency responders and law enforcement to address the situation.

A spokeswoman from the U.S. Department of Transportation Pipeline and Hazardous Materials Safety Administration (PHMSA) said the organization was aware of the spill and officials were despatched to take corrective measures and relief.

The spill comes at a time of concern and debate by environmental activists and energy firms over the issues of pipeline safety and security.

Climate-change activists earlier this month disrupted the flow of millions of barrels of crude from Canada to the United States, in support of a Native American tribe protesting the construction of the controversial Dakota Access crude oil pipeline.

The Standing Rock Sioux Tribe has protested the construction of the $3.7 billion Dakota Access pipeline that will carry oil from North Dakota to the U.S. Gulf Coast, over fears of potential damage to sacred land and water supplies.

The news pushed the discount between front-month U.S. crude futures and the second-month to 69 cents, the widest in nearly two months. The prompt crude spread, often correlates to the supply-demand balance in Cushing.

Reporting by Devika Krishna Kumar in New York and Liz Hampton in Houston; Additional reporting by Arpan Varghese and Karen Rodrigues in Bengaluru; Editing by Simon Webb, Bernadette Baum and David Gregorio