Michigan AG sues to shut down oil pipeline in Great Lakes

Associated Press

June 28, 2019

 FILE - This July 19, 2002, file photo, shows the Mackinac Bridge that spans the Straits of Mackinac from Mackinaw City, Mich. Enbridge Inc. said Monday, June, 17, 2019, it’s moving ahead with collection of rock and soil samples in the Straits of Mackinac while preparing for a court battle with Michigan’s governor over a planned oil pipeline tunnel there.

LANSING, Mich. — Michigan's attorney general sued Thursday to shut down twin 66-year-old oil pipelines in the Great Lakes, saying they pose an "unacceptable risk" and the state cannot wait five to 10 years for Enbridge Inc. to build a tunnel to house replacement pipes running through the Straits of Mackinac.

Democrat Dana Nessel's move came the same day she also sought to dismiss the Canadian company's request for a ruling on the legality of a deal it struck last year with former Republican Gov. Rick Snyder to encase a new segment of its Line 5 in the proposed tunnel.

"I have consistently stated that Enbridge's pipelines in the Straits need to be shut down as soon as possible because they present an unacceptable risk to the Great Lakes," Nessel said.

Nessel said she acted after it became clear talks between Enbridge and Democratic Gov. Gretchen Whitmer had broken down. Whitmer was pushing to finish the tunnel in two years, while Enbridge was insisting it could not be done before 2024, when it would decommission the existing pipes.

"The continued operation of Line 5 presents an extraordinary, unreasonable threat to the public because of the very real risk of further anchor strikes, the inherent risks of pipeline operations and the foreseeable, catastrophic effects if an oil spill occurs at the Straits," Nessel said.

The pipelines are part of Enbridge's Line 5, which carries 23 million gallons (87 million liters) of crude oil and propane daily between Superior, Wisconsin, and Sarnia, Ontario.

Enbridge spokesman Ryan Duffy said decommissioning the pipes would result in a "serious disruption" to the energy market, saying the line meets 55% of Michigan's propane needs, including 65% used in northern Michigan and the Upper Peninsula. Refineries served by Line 5 also supply a large portion of the aviation fuel at Detroit Metro Airport.

"We remain open to discussions with the governor, and we hope we can reach an agreement outside of court," he said. "Enbridge is deeply committed to being part of Michigan's future. We believe the Straits tunnel is the best way to protect the community and the Great Lakes while safely meeting Michigan's energy needs."

Enbridge insists the dual pipes, which have been in place since 1953, are in sound condition and could operate indefinitely. But the company, based in Calgary, Alberta, said it is willing to install a tunnel in bedrock 100 feet beneath the lakebed and foot the estimated $500 million bill to eliminate virtually any possibility of a leak.

Opponents contend Enbridge's refusal to shut down the pipelines until the tunnel is completed means the Straits area would be endangered for at least another five years. They point to a vessel anchor strike in April 2018 that dented both pipes while damaging three nearby electric cables, which leaked 800 gallons of insulating mineral oil.

Nessel's suit, which was applauded by environmental groups and criticized by Republican lawmakers, identifies a potential anchor strike as the most significant risk to Line 5. It asks an Ingham County judge to rule that the operation of the Straits pipelines under a state easement violates the public trust doctrine, is a public nuisance and violates the Michigan Environmental Protection Act because it is likely to cause pollution and destroy water and other natural resources.

Earlier this year, Whitmer ordered her administration not to implement the tunnel plan after Nessel said authorizing legislation enacted in December violated the state constitution.

"Although the governor remains willing to talk with Enbridge, her commitment to stopping the flow of oil through the Great Lakes as soon as possible — and Enbridge's decision to sue the governor rather than negotiate — will at some point require her to take legal action, as well," said spokeswoman Tiffany Brown.

Whitmer directed the Department of Natural Resources to review Enbridge's compliance with the 1953 easement.

Enbridge said Thursday it asked Whitmer last week to resume talks, offering to suspend the lawsuit it filed earlier this month and jointly appoint an independent moderator to help facilitate discussions. The company also pointed to safety actions that have been taken to prevent anchor strikes.

Wisconsin Supreme Court backs Enbridge in Dane County case

 FILE - This June 29, 2018 photo shows tanks at the Enbridge Energy terminal in Superior, Wis.

MILWAUKEE  — The Wisconsin Supreme Court ruled Thursday that Canada-based Enbridge Energy doesn't need to carry additional insurance for a pipeline project in Dane County, despite the local government's insistence that it do so in case of an accidental spill.

Dane County officials made a $25 million environmental liability policy a requirement for Enbridge's permit for a project to triple the flow of crude oil from its Line 61 pipeline to 1.2 million barrels per day. The pipeline runs from northern Wisconsin to Illinois.

The Court's conservative majority ruled in favor of Enbridge 4-1, with two liberal justices abstaining.

Dane County approved the permit in 2015 with the insurance requirement. In asking for additional insurance, Dane County officials cited the 2010 Enbridge oil spill in southwest Michigan that cost $1.2 billion and has resulted in ongoing insurance litigation. In that case, the U.S. government fined Enbridge more than $1.8 million after accusing the company of missing deadlines for pipeline inspections following the gigantic oil spill that polluted nearly 40 miles (64.37 kilometers) of the Kalamazoo River, shorelines and wetlands. Cleanup lasted four years.

Enbridge appealed Dane County's insurance requirement, but Wisconsin lawmakers intervened before the company's challenge was decided, passing a last-minute provision in the state budget that blocked municipalities from imposing additional liability requirements when a pipeline operator already carries comprehensive insurance.

 In this June 29, 2018, file photo, pipeline used to carry crude oil is shown at the
Superior terminal of Enbridge Energy in Superior, Wis.

Dane County required the extra insurance anyway, prompting Enbridge to appeal at the circuit court level, where they won, only to have an appeals court decide that Enbridge hadn't proven it carried enough insurance.

The high court reversed that Thursday, writing that Enbridge already had sufficient insurance.

"Enbridge is pleased with the decision of the Supreme Court to uphold the Dane County Circuit Court's decision to strike unenforceable insurance requirements from the (conditional use permit)," Enbridge spokeswoman Jennifer Smith said in a statement.

While the court battle played out, Enbridge finished its $1.5 billion upgrade to its pipeline and built the needed pumping station, since state lawmakers made Dane County's requirement unenforceable.

"The Waterloo pump station is critical infrastructure for the state of Wisconsin and for the region, helping to ensure a reliable source of energy for decades to come," Smith said.

Enbridge has said that it has $860 million worth of general liability insurance that includes coverage for sudden and accidental pollution, but the county and landowners involved in the case say the company hasn't provided sufficient proof.

An attorney for Dane County, David Gault, called the court's ruling "primarily the result of an ill-conceived and poorly worded special interest statute."

Patricia Hammel, one of the attorneys representing the landowners, said in a statement that the court's "decision allows Enbridge to operate the largest tar sands pipeline in the U.S across Wisconsin without adequate insurance and exposes our people, land and water to the consequences of a catastrophic spill."

In ruling in favor of Enbridge, the conservative justices concluded that lawmakers "rendered Dane County's extra insurance conditions unenforceable, and the proper remedy is to strike the illegal conditions."

Dissenting from the majority, Justice Ann Walsh Bradley, echoed the arguments from landowners and the county, saying that Enbridge has not shown that it carries the needed insurance that would make what the county is asking for moot.

"In sum, I determine that Enbridge did not demonstrate that it 'carries' insurance that includes 'sudden and accidental' coverage."

Enbridge has disputed that claim.

Enbridge, which operates Line 3 in Minnesota, is going through a legal battle there as well as it tries to replace the aging crude oil pipeline that runs through the northern part of the state. Earlier this month, two state agencies said they would hold up approval of the project's permits until problems with its environmental review are resolved.