Big month ahead, including major Line 3 court ruling
Tribal nations and environmental and Indigenous-led groups have worked for years to stop Enbridge’s proposed Line 3 tars sands pipeline through northern Minnesota. Line 3 is bad for the environment, bad for climate, violates treaty rights and simply isn’t needed.
Enbridge is a multi-national, bottom-line company seeking to minimize its costs and maximize its profits. It prioritizes its profits over the environment, climate, and treaty rights.
Minnesota regulators shouldn’t have put their trust in Enbridge, let alone approved Line 3 permits. There are plenty of examples to show how Enbridge has lacked transparency and not been a reliable partner, both here and in other states.
Work on Line 3 has slowed in the past few months due to springtime construction restrictions. It’s now picking back up.
The Minnesota Court of Appeals will rule no later than June 21 on the first of three major legal challenges to Line 3 in state and federal courts. This first suit seeks to overturn Line 3’s Certificate of Need, Route Permit, and Environmental Impact Statement.
With a busy and important month ahead, I’m take this opportunity to review the red flags I’ve seen surrounding Enbridge and its Line 3 proposal.
1. A bad fit from the start
Enbridge admitted in its Application to Cross Public Waters that it couldn’t build Line 3 and meet all of Minnesota’s environmental standards “given northern Minnesota’s topography and environment.” (State rules say pipelines should avoid wetlands and Line 3 as proposed would cross 78 miles of wetlands, or more than 20 percent of the entire route.)
That should have been the stop sign right there.
2. Spill history
A 2010 Enbridge pipeline spill in Michigan dumped more than 1 million gallons of tar sands crude oil near and into the Kalamazoo River. It took five years and nearly $1.5 billion to clean up. The spill shut down some 35 miles of the river. The National Transportation and Safety Board (NTSB) released a highly critical report: “Enbridge’s massive oil pipeline spill in Michigan in 2010 was caused by a complete breakdown of company safety measures, while its employees performed like ‘Keystone Kops’ trying to contain it,” the NTSB wrote.
(For more on Enbridge’s spill history, see its rap sheet from the Corporate Research Project.)
3. Using corporate shell games to avoid liability
- Prior to Line 3, Enbridge proposed building the Sandpiper pipeline in Minnesota. Sandpiper never got built, but it provided an important lesson. At a 2018 Line 3 hearing, Minnesota Department of Commerce Deputy Commissioner Bill Grant said the state was “a babe in the woods” during the Sandpiper proposal. Commerce would later learn that Enbridge had a corporate structure that would have protected much of the parent company’s assets against any spill claims – putting future clean-up costs on Minnesota taxpayers. The state secured stronger liability language this time around.
- The state of Michigan had similar concerns about Enbridge Line 5. It conducted a study and found Enbridge Inc. had 275 subsidiaries. The report concluded that Enbridge’s corporate structure would leave Michigan with financial liability in the case of a major spill — unless Canadian parent Enbridge provided “a voluntary financial bailout.”
4. Delays in spill reporting and repairs
These are some of the recent problems:
- On Oct. 27, 2017, the AP reported that Enbridge admitted to a three-year delay in reporting problems with the protective coating on Enbridge Line 5, twin tar sands crude oil pipeline that lay on the floor of the Straits of Mackinac. “Michigan Agency for Energy Director Valerie Brader says her office’s trust in Enbridge ‘has been seriously eroded,’” the story said.
- In 2018, the federal government fined Enbridge $1.8 million for failing to meet pipeline inspection deadlines, the Duluth News Tribune reported. “The inspections the government said ‘do not meet the requirements’ included several Minnesota stretches of Enbridge’s Line 2, Line 3 and Line 4, according to court filings.”
- Enbridge had a 15-month delay reporting a crude oil spill near Fort Atkinson, Wisc., the Wisconsin State Journal reported. Any spills greater than 5 gallons need to be reported. “Enbridge initially reported that 1.35 gallons of material had spilled, but later revised that estimate to 1,225 to 1,386 gallons.” Groundwater tests found benzene concentrations more than 4,000 times the state limit. Enbridge also took more than month to permanently fix the problem, WPR reported. The spill happened April 26, 2019, the permanent repair was June 2, 2019, and Enbridge reported the spill July 31, 2020. Enbridge now faces a fine in the millions.
- In 2020, the U.S. Environmental Protection Agency (EPA) fined Enbridge $6.7 million for failing to fix pipeline safety problems, the Detroit Free Press reported. “Among other things, the EPA said Enbridge neglected to properly evaluate thousands of “shallow dents” on its Lakehead Pipeline System, which runs through both of Michigan’s peninsulas and includes an underwater stretch of twin pipelines through the Straits of Mackinac.”
5. Low-balling environmental impacts
Administrative Law Judge (ALJ) Ann O’Reilly took testimony on Line 3’s Certificate of Need and issued a report with findings and recommendations. She wrote: Enbridge’s testimony on Line 3’s potential damage to lakes, groundwater, and wild rice waters was neither “credible or persuasive.”
6. Providing vague information
The Minnesota Department of Natural Resources (DNR) wrote that the Environmental Protection Plan Enbridge submitted for the new Line 3 pipeline “was too general to be relied upon…” (A company the size of Enbridge has the resources to write a really good Environmental Protection Plan.)
7. Indifference to Anishinaabe cultural ways
Heidi Tillquist, Director of Oil and Gas Risk Management for Stantec and one of Enbridge’s witnesses during the Line 3 contested case hearing, testified that after an oil spill, “recovery” could take days, decades, or longer to occur. Spills that harm groundwater may take the longest to recover.
“By ‘recovery,’ however, Tillquist explained that she meant returning an environment to a point where it meets regulatory standards. This does not necessarily mean returning the environment to the conditions that existed before the spill. For example, if a spill were to detrimentally impact a particular food source in an area, such as wild rice, wildlife would adopt and choose another food source for subsistence. Ms. Tillquist’s analysis, however, did not consider the cultural loss that would occur as a result of damage to the natural environment, including the impacts to wild rice.” [Emphasis added.]ALJ Ann O’Reilly’s Line 3 report, page 245
8. Failure to take MMIW, sex trafficking seriously and provide transparency
Minnesota tribes and Indigenous organizations warned that the influx of out-of-state workers would increase sex and drug trafficking along the Line 3 construction route. Enbridge denied there was any such connection. It proposed a weak Sex trafficking Prevention Plan (made possible by the Minnesota Public Utilities Commission (PUC’s) rubber stamp). News outlets reported this winter that two Line 3 workers were arrested as part of a sex trafficking sting. Enbridge remained silent about the arrests. The PUC didn’t require Enbridge to report on sex trafficking arrests of Line 3 workers. There’s no transparency on the problem.
9. Not meeting jobs promises
Enbridge promised the PUC that Line 3 construction would create about 8,600 jobs (6,500 of them, or 75 percent, local) in Minnesota over a two-year period. We now know construction work will only last one season, not two. That alone would seem to cut the promised jobs benefit roughly in half. Worse yet, in the last quarter of 2020, Minnesota residents held only one third of all project jobs and had only 28 percent of hours worked. Enbridge chose not to release jobs data for the first quarter of 2021. One could infer that if the numbers met Enbridge’s promise, the company would have released them.
10. Jobs study lacked transparency
In a related matter, Enbridge used a University of Minnesota-Duluth (UMD) study as the basis for its job creation claims. It got some positive press. However …. the Duluth-based Area Partnership for Economic Expansion, or APEX, funded the study, Minnesota Native News reported. Enbridge, UMD and the Duluth News Tribune all sat on the APEX board — “and the group had publicly declared its support for the Enbridge Line 3 pipeline project,” a source of potential bias.
Eyes on the Ties, an online news site of Public Accountability Initiative & LittleSis, criticized UMD’s analysis. Its report “lays out the details about the undisclosed payments, significant conflicts of interest, and methodological problems surrounding the UMD study,” the LittleSis website said. An Enbridge consulting firm and APEX “paid UMD over $15,000 to produce the study. This wasn’t disclosed in the study. Enbridge provided much of the data researchers used to produce the jobs report, calling into question whether this was an unbiased report.
11. Biased oil demand analysis
The first basic question posed to a company looking to build a new crude oil pipeline in Minnesota is whether it can show there is enough future oil demand to justify building it. ALJ O’Reilly said Enbridge’s forecast data was biased, “created by an industry group whose express purpose is to advocate for the expansion and development of the Canadian oil industry.”
The Minnesota Department of Commerce has made clear that Minnesota refineries are in good shape for oil supply and the new larger Line 3 isn’t needed. Commerce took the extraordinary step to sue the PUC to reverse Line 3’s Certificate of Need.
12. Problems with Landowner Choice Program
The first rule of kindergarten is to clean up your old mess before creating a new one. Enbridge didn’t want to pay the cleanup costs of removing the old Line 3, roughly $1.2 billion. Instead, it proposed the Landowner Choice Program, which would give landowners the choice between having Enbridge remove the old pipeline or leaving it in the ground in exchange for a one-time payment. It’s to Enbridge’s financial benefit to have landowners leave the pipe in the ground. It passes cleanup costs to future generations.
Enbridge is supposed to provide outreach and information to affected landowners. Attorney Evan G. Carlson filed a complaint with the PUC April 28 on behalf of landowners, saying “Enbridge has demonstrated a pattern of withholding information or misinforming landowners regarding their right to decide to decommission in place or physically remove.”
Enbridge calls the claim groundless.
13. Pipeline capacity questions linger
Enbridge already has met the crude oil capacity goals it used to justify building the new Line 3 without having to actually build it, Honor the Earth says.
Enbridge’s Mainline system through Minnesota has six Lines: 1, 2, 3, 4, 65 and 67. Enbridge’s expert witness said the Mainline Corridor’s capacity was 2.4 million barrels a day in 2017, an amount that would remain unchanged through 2033 without new construction. The new Line 3 would increase the Mainline Corridor’s capacity to nearly 2.8 million barrels a day, Enbridge said.
Honor the Earth reported that Federal Energy Regulation Commission’s (FERC’s) data shows that in the first quarter of 2020 (pre-pandemic) Enbridge already was moving 2.8 million barrels a day through its Mainline system without new construction. The new Line 3 would add even more capacity.
Enbridge argues the PUC has no jurisdiction over this issue, and even if it did Honor the Earth’s allegations were unfounded.
14. Hidden role in “grass roots” influence campaign
Enbridge tried to gin up “grass roots” support for Line 3 by creating/supporting front groups such as Minnesotans for Line 3, DeSmog Blog reported. The public wasn’t made aware of Enbridge’s role in the organization. However, the Federal Communications Commission (FCC) requires parties placing TV political ads to list their officers. An FCC filing for a Minnesotans for Line 3 ad buys listed four names as Minnesotans for Line 3 leaders. Three were Enbridge executives, including CEO Al Monaco.
15. Complicity with Dakota Access Pipeline (DAPL) security abuses
Enbridge agreed to buy a 37 percent stake in Dakota Access, LLC in August, 2016, prior to the worst violence at Standing Rock. Winona LaDuke, co-founder of Honor the Earth, said security officers used dogs against water protectors at Standing Rock in September, 2016. She called Enbridge and asked the company “to pull off the dogs” and “demilitarize the situation.” Enbridge did not respond, she said.
16. Playing state regulators like a fiddle
- There are more than two dozen Independent Environmental Monitors spread out along the 337-mile Enbridge Line 3 pipeline corridor in northern Minnesota. They are supposed to be the eyes and ears for state regulators, making sure Enbridge is following all permits and rules and minimizing environmental damage. However, state regulators allowed Enbridge to select and train the independent monitors. Half of the 25 independent monitors hired to work on behalf of Minnesota state regulatory agencies have worked on Enbridge projects at some time in the past, according to monitor resumes. They might want to work with Enbridge in the future. It raises questions about how “independent” these monitors really are.
- Throughout the PUC review process, Enbridge took what seemed to be contradictory positions. It said the old Line 3 needed to be replaced for safety reasons. It also said it would continue to operate the old Line 3 if the PUC didn’t approve the new pipeline,and could do so safely. The federal government, not the state, has oversight for pipeline safety, but the gambit worked. PUC commissioners approved Line 3 out of fear the old one would rupture. Commissioner Dan Lipschultz referred to the decision as having a “gun to the head.”
Other red flags? Add them in the comments section.