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Oil pipeline disputes raise tensions between U.S. and Canada

The Associated Press
Oil pipeline disputes raise tensions between U.S. and Canada

TRAVERSE CITY, MICH.—Months after President Joe Biden snubbed Canadian officials by cancelling Keystone XL, an impending showdown over a second crude oil pipeline threatens to further strain ties between the two neighbours that were frayed during the Trump administration.

Michigan Gov. Gretchen Whitmer, a top Biden ally, ordered Canadian energy company Enbridge last fall to shut down its Line 5 – a key piece of a crude delivery network from Alberta’s oilfields to refineries in the U.S. Midwest and Eastern Canada.

Whitmer’s demand pleased environmentalists and tribes who have long considered the pipeline, which reaches 1,038 kilometres across northern Wisconsin and Michigan, ripe for a spill that could devastate two Great Lakes.

A section roughly 6.4 kilometres long crosses the bottom of Michigan’s Straits of Mackinac, which connects Lake Michigan and Lake Huron. The area is a popular tourist destination and several tribes have treaty-protected commercial fishing rights in the straits.

But with the governor’s May 12 shutdown deadline approaching, Canadian officials are lining up behind Enbridge as it contests the order in U.S. court and says it won’t comply. The Calgary-based company says Whitmer is overstepping her authority and that the 68-year-old pipeline is sound.

“Our government supports the continued safe operation of Enbridge’s Line 5,” Seamus O’Regan, Canada’s minister of natural resources, told The Associated Press in an email. “It is a vital part of Canadian energy security, and I have been very clear that its continued operation is non-negotiable.”

A Canadian House of Commons committee this month warned of dire consequences from a shutdown: job losses, fuel shortages and traffic nightmares as 87 million litres of petroleum liquids transported daily through Line 5 are shifted to trucks and rail cars considered more susceptible to accidents.

The panel urged Prime Minister Justin Trudeau and other Canadian officials to lobby their U.S. counterparts and said that without an agreement, Canada might invoke a 1977 treaty barring either nation from hampering oil and natural gas transmission. O’Regan’s office said the matter had been raised at the “highest levels” of federal and state governments.

The dispute comes as both nations hope to reset their relationship after the presidency of Donald Trump, who put tariffs on Canadian steel and aluminum and had a turbulent relationship with Trudeau. Biden’s first meeting with a foreign leader was a virtual session with Trudeau in February, where they pledged co-operation on climate change and other matters.

Biden’s cancellation of Keystone XL, a 1,931-kilometre pipeline from Alberta’s oilsands, remains a sore point in Canada. Although Trudeau objected to the move, Alberta officials are “extremely disappointed” he isn’t taking stronger action, said Sonya Savage, energy minister in the province home to most of Canada’s oil production.

Now comes Line 5, which few Americans outside the Great Lakes region may know about. But it’s a priority for Canada, the world’s fourth-largest producer and third-largest exporter of oil.

“The Canadians are likely to make this their big issue,” said Christopher Sands, director of the Canada Institute at the Wilson Center, a global policy think-tank in Washington, D.C. “This is one where I don’t think (Trudeau) can afford to back down.”

While the Keystone project was halted in early construction, Line 5 has transported Canadian oil since 1953. More than half of Ontario’s supply passes through it, according to Enbridge. It exits Michigan at the border city of Sarnia, Ontario, and connects with another line that provides two-thirds of crude used in Quebec for gasoline, home heating oil and other products.

“It’s an energy lifeline for Canada,” said Mike Fernandez, an Enbridge senior vice-president.

Enbridge and its supporters in industry and labour say the pipeline also benefits the U.S. Midwest. It carries oil for jet fuel and gasoline, as well as natural gas liquids made into propane.

Critics say most economic benefits go to Canada, while Michigan risks a rupture that could foul hundreds of miles of waters.

“The Canadians are awfully silent about our shared responsibility to protect the Great Lakes, which hold 20 per cent of the world’s fresh surface water,” said Liz Kirkwood, director of a Michigan group called For Love of Water.

Opposition to oil pipelines in the U.S. has hardened, with fights over Keystone, the controversial Dakota Access Pipeline and Enbridge’s Line 3 in Minnesota drawing protesters.

Climate change hovers over the debate as Biden pursues emission reductions. He cancelled Keystone on his first day in office. A week later, he temporarily suspended sales of oil and gas leases from federal lands. Environmentalists want a permanent ban, which could make the U.S. more dependent on Canadian crude whether it’s delivered by pipeline or not.

“That’s the conundrum any administration will find themselves in when their climate goals run headlong into the realities of providing essential energy,” said Drue Pearce, deputy administrator of the federal pipeline safety agency under Trump and now with the Holland and Hart law firm.

No leaks have been reported from Line 5’s underwater pipes. But a National Wildlife Federation report in 2017 said federal documents showed more than two dozen spills from other sections exceeded 3.8 million litres.

Enbridge has spent about $1 million on ads supporting the pipeline, while opponents have fought it with studies, protests and media events.

But lawsuits the company and Michigan have filed against each other may decide the outcome.

Although the federal government regulates oil pipelines, Great Lakes bottomlands are under state jurisdiction. Michigan granted an easement in 1953 to place Line 5’s twin pipes beneath the Straits of Mackinac.

However, Whitmer revoked it Nov. 13, saying Enbridge had violated its safety requirements _ including one that prohibits unsupported gaps beneath the pipes.

There may be little Biden can do to satisfy Canada aside from quietly urging Whitmer to relent. That could be difficult given his ties to the governor, whom Biden considered for his running mate last year and appointed a vice-chairwoman of the Democratic National Committee.

White House spokesperson Vedant Patel declined comment.

U.S. pipeline safety falls under the Department of Transportation, whose Biden-appointed secretary, Pete Buttigieg, endorsed a Line 5 shutdown last year while seeking the Democratic presidential nomination. A spokesperson said in an email that the department wasn’t involved in the legal fight between Michigan and Enbridge but will inspect Line 5 in coming months.

Whitmer’s office did not respond to requests for comment. When announcing her shutdown order, she said Enbridge had “imposed on the people of Michigan an unacceptable risk of a catastrophic oil spill in the Great Lakes that could devastate our economy and way of life.”

Enbridge reached a deal in 2018 with Michigan’s previous governor, Republican Rick Snyder, to reroute the underwater segment of Line 5 through a new tunnel.

But opponents say the tunnel carries its own environmental risks and the lakes would remain in jeopardy if the pipeline continues operating during years of construction.

Debate over Line 5 and other pipelines illustrates the conflicting priorities for two countries that have pledged to reduce fossil fuel emissions but still burn lots of oil, said Daniel Raimi, a fellow at Resources for the Future, a Washington, D.C., policy institute.

“They don’t want to disrupt a crucial piece of infrastructure and cause higher energy prices for consumers,” Raimi said. “It’s a difficult needle to thread.”

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