Oil was still flowing Thursday on Enbridge Inc.’s disputed dual-pipe Line 5 across the Straits of Mackinac after an inconclusive round Wednesday in the third court fight since 2018 over Michigan demands to turn off the 540,000 b/d conduit.
No order emerged to enforce a Wednesday shutdown deadline set by Gov. Gretchen Whitmer from the U.S. District Court for Western Michigan. Instead, court-ordered mediation that started in April is to continue.
Whitmer raised prospects of further legal action to try inflicting a financial penalty on Enbridge in a widely circulated letter to Enbridge’s Vern Yu, executive vice president of the Calgary-based pipeline, power and utility conglomerate.
The governor wrote that Line 5 “constitutes an intentional trespass” that began Wednesday because she had revoked the 68-year-old state property easement for the four-mile crossing of the straits between Lake Michigan and Lake Huron.
“Enbridge’s continued operation of the straits pipelines after May 12, 2021 is at its own risk,” wrote Whitmer. “If the state prevails in the underlying litigation, Enbridge will face the prospect of having to disgorge to the state all profits it derives from its wrongful use of the easement lands following that date.”
The Canadian government told the district court that Line 5 is in U.S. jurisdiction and Michigan interference is barred by a 1977 treaty, the Agreement Between the Government of the United States and the Government of Canada Concerning Transit Pipelines.
As Line 5 kept flowing despite the shutdown demand Yu said, “Enbridge has a responsibility to the people of Michigan and the Great Lakes region, and will continue to operate Line 5 safely, reliably and affordably to fuel to the region’s economies.”
Enbridge noted that both houses of the Michigan legislature passed, by big majorities, a December 2018 bill that ratified an agreement with the previous Republican state executive branch to bury the straits pipeline crossing in a $500 million tunnel.
Whitmer and Michigan Attorney General (AG) Dana Nessel launched efforts to turn off Line 5 when they took office after winning a fall 2018 election on a platform that branded the straits crossing a menace to the Great Lakes region.
Over the past 28 months the Democrat executive branch has lost state court battles for orders to cancel the tunnel agreement as unconstitutional.
The dispute has highlighted oil reliance in the United States and Canada, with suppliers and buyers predicting that choking off Line 5 would inflate energy prices and hurt livelihoods across a wide swath of both countries.
Ohio and Louisiana AGs had intervened in the court case to defend Line 5. “Shutting down Line 5 will have enormous economic consequences — several billion dollars in losses — for Toledo, OH and beyond,” their lawsuit stated. “And the industrial impact would be on a similar scale. A cessation of Line 5 will reduce the gas, diesel, and jet fuel supply in Michigan, Ohio, Pennsylvania, Ontario and Quebec by 14.7 million gallons per day.”
The Canadian government intervention in the case said a Line 5 shutdown would also threaten an Ontario refining and petrochemical complex that sustains about 28,400 jobs while “devastating” western oil supply operations and employment.
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