Enbridge heads to court as Line 5 talks sour with Whitmer
Enbridge Energy plans to ask the Michigan Court of Claims to rule on the validity of its deal to construct a tunnel for the Line 5 oil pipeline beneath the Straits of Mackinac as the negotiations over the future of the 66-year-old pipeline came to a standstill.
The Canadian pipeline company "walked away from the negotiating table with the governor" Tuesday and chose litigation rather than to "negotiate in good faith," Gov. Gretchen Whitmer's office said Thursday.
"It is now abundantly clear that Enbridge — which is responsible for the largest inland oil spill in American history in Marshall, Michigan — is only interested in protecting its bottom line," Whitmer's office said in a statement.
But Enbridge officials said Thursday they are seeking a legal remedy because Whitmer is insisting that the current pipeline stop operations in two years. Officials for the Canadian pipeline company said it cannot meet the two-year deadline after saying last week its best-case timeline for tunnel completion would be five years.
Enbridge's complaint, filed Thursday and assigned to Court of Claims Judge Michael J. Kelly, asks the judge to declare the law that enabled Enbridge's agreements with the state and the agreements themselves valid and enforceable.
“We are taking this action in order to protect Michigan consumers,” said Guy Jarvis, Enbridge’s executive vice president for liquid pipelines. “We require a court review of the enforceability in order to remove obstacles to building the tunnel as quickly as possible and ensure energy security and environmental protection for Michigan.”
While Enbridge's agreement with Republican former Gov. Rick Snyder included no end date in writing for the project, the company has indicated it could complete the tunnel in five to 10 years.
Enbridge expects to spend $40 million of the project's total $500 million price tag in 2019, Jarvis said. But to spend the money and continue the project in an efficient manner, the company needs a state court to rule on the validity of the state law that codifies the tunnel agreement, he said.
Enbridge said Thursday it would continue to move forward with its geotechnical work in the Straits so it won't miss the narrow summer window for seasonal work. It will also begin preliminary work on additional applications for permits.
"We’re fully prepared and ready to go on all of the work that is necessary," Jarvis said.
Earlier this week, after weeks of meetings with Enbridge, Whitmer said she'd like to reach an agreement by Monday on the future of Line 5. The East Lansing Democrat indicated that she was not comfortable with a five-year timeline for construction, nor did she believe Enbridge would meet the deadline.
Whitmer issued a directive to state agencies in March to stop processing permit applications for Enbridge after an opinion from Attorney General Dana Nessel found certain parts of the state law and tunnel agreement with the state to be invalid.
In her March opinion, Nessel said the revised state law violated the Constitution's title object clause “because its provisions go beyond the scope of what was disclosed in its title.”
Enbridge officials said Thursday the Michigan Legislature met the title object requirements when they passed the law and hoped the state court would agree and declare the agreement valid.
Nessel said Thursday she was pleased the company also sought "an expedited resolution to this matter."
"We look forward to seeing them in court," she said.
House Speaker Lee Chatfield, whose Northern Michigan district includes the Straits, said the House passed the "right legislation" last year, laws that would secure heating resources for people in Michigan.
"I am glad to see the issue continuing to move forward, and I hope the courts uphold the democratically-enacted law to protect northern Michigan and our entire state," the Levering Republican said.
The decommissioning of Line 5 prior to the completion of the tunnel would result "in a disruption of the energy supply throughout the state" and affect Michigan residents, businesses and refineries, Jarvis said.
Enbridge has offered additional assurances to the state during negotiations, including more safeguards for the current pipeline and procuring a boring machine prior to receiving regulatory approvals to speed the process along, Jarvis said. While the state and Enbridge both wanted to find a speedy, safe solution, "how we go about that is where we have not yet reached agreement," he said.
"We feel we have an open line of communication into the governor’s office on the matter, but it does appear they’re holding firm to that requirement," Jarvis said, referring to the two-year timeline for Line 5's closure.