Canada: Stall Line 5 shutdown due to treaty discussions with U.S.

The government of Canada is urging a federal judge to stall Line 5's state-ordered shutdown through the Straits of Mackinac because of ongoing discussions between the Canadian and U.S. governments.

The Canadian government said in an amicus brief served on parties before the Grand Rapids U.S. District Court that the closure of the dual oil pipeline, which was supposed to occur by Wednesday, would result in "certain, immediate and serious harm to several important interests."

The government of Prime Minister Justin Trudeau asked the court to stop the closure until a resolution is reached through court mediation or the United States and Canada have considered its effect on a 1977 treaty between the two countries that barred either nation from interfering in the operations of international oil pipelines. Canada has started discussions with the Biden administration in an effort to resolve the situation, the amicus brief said, but the treaty has not been formally invoked. 

A facility in Sarnia, Ontario, Canada, shot from Marysville across the St. Clair River, Saturday, January 30, 2021.

"While a shutdown that is inconsistent with governing law should be avoided under all circumstances, in any event, there should be no shutdown before the governments of the United States and Canada complete their efforts to resolve this matter, pursuant to their bilateral treaty, which directly addresses transit pipelines such as Line 5," the Canadian amicus brief said.

Jen Psaki, press secretary for President Joe Biden, declined Wednesday to comment on U.S. communications with Canada related to the state-ordered Line 5 closure because of the pending court case.

The U.S. State Department said Wednesday the U.S. and Canada "are not engaged in any formal treaty negotiations" with respect to Enbridge. But the two nations are in "continued cordial dialogue on topics of mutual interest to our bilateral relations, including cross-border pipelines."

"We are tracking closely the engagement between the state of Michigan and Enbridge and hope the parties can come to a mutually agreeable resolution," a department spokesperson said.

Gov. Gretchen Whitmer's office stood by its closure order, noting the hacking of the Colonial Pipeline shows the risk of "relying heavily on a single energy supply."

"The Line 5 pipeline is a ticking time bomb that threatens over 1.3 million jobs that generate $82 billion in wages annually across the U.S., including 350,000 jobs in Michigan," Whitmer spokesman Bobby Leddy said. 

Canadian officials have opposed the pipeline's closure and speculated that Whitmer's shutdown order could violate the 1977 treaty, but the amicus brief appears to be the first confirmation that invocation of the treaty is under serious consideration. 

"The agreed international processes for reconciling Canadian interests with U.S. interests and reconciling environmental interests with energy security and economic interests should be followed, and should not be set aside based on unilateral state action under state law," the document said. 

The brief accompanied others by the North America's Building Trades Union, United Steelworkers of America, and the chambers of commerce for the U.S., Canada, Michigan and Ohio. The briefs supported Enbridge's position that the court battle over the continued operation of Line 5 should remain in federal court. 

Members of the chambers "will face, at best, significant strains on their businesses due to inflated energy prices, and will almost certainly face energy emergencies for propane, gasoline, jet fuel, and other products on which they depend and that flow and are processed across state lines and the international boundary with Canada," according to the brief. "The Chambers also urge all parties to work earnestly to find a solution that avoids these outcomes and protects the tunnel project."

After months of litigation and fruitless negotiations, Whitmer in November revoked Enbridge Energy's easement in the Straits of Mackinac and ordered the pipeline running through the Straits be shut down in six months or by May 12. 

Whitmer and Democratic Attorney General Dana Nessel, who both campaigned on promises to shutter the line, have been seeking a shutdown order based on the easement revocation. 

The Line 5 matter has ended up in federal court. Enbridge and the state entered mediation in the case in April. 

District Judge Janet Neff is expected to decide in the coming weeks whether the state's case should be moved to Ingham County or stay in federal court. 

The Canadian oil giant has said it will not close the line short of a court order, and Whitmer said Tuesday she would pursue all profits made from operations after Wednesday should the state win in court.

While Enbridge has garnered the support of Canada, Ohio, various chambers and unions in its effort to keep the case in federal court, Nessel has the support of Michigan's 12 Native American tribes and 17 attorneys general

Canada in its amicus brief argued that the shutdown would have an impact not only on the international treaty, but also on the country's "energy security and economic prosperity."

The 68-year-old dual span has been criticized by environmentalists for posing an undue risk of a catastrophic oil spill between Lakes Michigan and Huron. The line can pump up to 540,000 barrels of light crude oil and natural gas liquids over the line a day. 

In 2018, Republican former Gov. Rick Snyder entered an agreement with Enbridge that would require the company to build a more than $500 million tunnel to house a new segment of Line 5 in the Straits. 

Whitmer has said her shutdown order will not affect the permitting and construction process for the tunnel. But industry advocates have warned an abrupt shutdown of the line would impact energy production and costs across the Midwest and Canada, particularly in Michigan's Upper Peninsula, which relies heavily on the natural gas liquids in the line for propane. 

Republican lawmakers reiterated their opposition to the closure Wednesday morning and echoed the concerns of the energy industry.

"Part of what is just absolutely frustrating and infuriating about those alleged reasons for not pushing to keep this open is what many of us lived through in the Upper Peninsula in the winter of 2014," said Sen. Ed McBroom, R-Vulcan, referring to an energy shortage that year. 

"The people who continually beat this drum that this isn’t going to affect Michigan right away are talking out of their hats," he said. 

Environmental groups have praised Whitmer for her decision and lambasted Enbridge for ignoring her order.

Officials with the For Love of Water group said Enbridge had a “troubling track record and that the governor was just trying to protect the state’s air, water and other natural resources from a potential oil spill."

"Michiganders have not forgotten Enbridge’s epic failure and legacy of the million-gallon, Line 6B oil spill disaster into the Kalamazoo River that drove about 150 families permanently from their homes and properties,” said Liz Kirkwood, the executive director of FLOW and an attorney in Traverse City.

The pipeline, FLOW officials said, is at risk of a rupture from anchor strikes given rough currents in the Straits.