Canadian officials to Michigan Senate: Line 5 shutdown would wreck economy

Oc. 12: Michigan tribes to Biden: Enbridge Line 5 threatens our treaty rights
Oct. 4: Hoping to avoid Enbridge Line 5 shutdown, Canada asks U.S. to negotiate
May 11: Michigan vows to seek Line 5 profits if Enbridge defies shutdown order
Update: On eve of Line 5 shutdown deadline, Enbridge vows to defy Michigan order

Keeping petroleum flowing through the Line 5 pipeline is imperative to the economy and energy security of Canada and the U.S., Canadian government, business and union representatives told a Michigan Senate panel on Tuesday.

During a 90-minute hearing that environmentalists decried as “political theater” meant to undermine Gov. Gretchen Whitmer’s plan to shutter the Enbridge Energy pipeline, Republican leaders of the Senate Natural Resources and Energy and Technology committees invited the visitors to weigh in on everything from how a shutdown could impact Canada’s economy to how much Canadians value the Great Lakes.

The three presenters — Bob Bailey, a member of the Canadian Provincial Parlaiment representing Sarnia-Lambton, Joseph Mancinelli, international vice president and regional manager of central and eastern Canada for the Laborers' International Union of North America, and Rocco Rossi, president & CEO of the Ontario Chamber of Commerce — stressed that they share Michigan’s concerns about pipeline safety, but that shutting down Line 5 would harm businesses and consumers in Michigan and Canada.

Related:

• Fish, propane, cash: Not everyone loves Enbridge generosity in the Straits
• Is the Line 5 tunnel a bridge to Michigan’s energy future or a bad deal?
• Gov. Whitmer offers propane plan for Upper Peninsula after Line 5 shutdown
• Q&A: What Michigan’s move to shut down Enbridge Line 5 means
• Michigan grants Enbridge key permits to build Line 5 tunnel under Straits
• With Line 5 closure, a ‘game of chicken’ over how to heat Upper Peninsula

In November, Whitmer gave Enbridge until May 13 to shut down the pipeline, calling the risk of an oil spill from the 68-year-old lakebottom pipes “unacceptable.” Her administration cited safety concerns on the pipeline that she said violate a 1953 easement that requires Enbridge to use “due care” in operating its pipeline in the Straits.

Since then, Canadian government officials have launched a vigorous lobbying effort to keep Line 5 open, taking their complaints to President Joe Biden’s administration. They cite a 1977 treaty that specifies “no public authority” in the U.S. or Canada can impede the flow of petroleum products through cross-border pipelines.

Bailey said he wrote Whitmer in December to express his concerns about the shutdown. Speaking to Michigan lawmakers Tuesday, he cast keeping Line 5 open as a “win-win” for Michigan and Ontario. 

Mancinelli told lawmakers that shutting down the pipeline would “have a devastating effect on a number of sectors and would destroy millions of workers’ jobs.”

He tied a potential shutdown to “nationwide” economic impacts, affecting everything from the auto industry and farming to the cosmetics industry that uses petroleum in makeup, to the sporting goods and pharmaceutical industries.

Those claims elicited protests from Democratic members of the committee, who argued a possible spill on the pipeline would bring far graver economic consequences for the region, and noted that the transition to clean fuels will bring new jobs to offset job losses in industries that currently rely on petroleum products.

When an anchor struck the pipeline (something that has happened more than once), said Sen. Marshall Bullock, D-Detroit, “we avoided a catastrophe by a stroke of luck, and we’re operating as if that didn’t happen.”

What, he asked presenters, is Canada and Enbridge’s plan should a spill happen on Line 5? 

Bailey said Enbridge officials would likely be willing to answer those questions in a future appearance before the committee.

Concerns about fuel shortages and economic harm have been a key point of contention in the debate about the pipeline’s fate, with Enbridge and its supporters arguing that a shutdown would raise fuel prices for Michigan residents and cut off supplies to regional refineries in Michigan, Ohio and Canada.

Some reports have estimated that any loss of transport capacity on Line 5 could be made up by increasing deliveries from other existing pipelines and transporting fuel by rail or truck, and Whitmer on Friday released a plan on Friday to offset propane losses from a Line 5 shutdown.

But Sen. Ed McBroom, R-Vulcan, who chairs the Senate Committee on Natural Resources and opposes shutting down the pipeline, opened Tuesday’s hearing by questioning the validity of Whitmer’s plan, saying it “does nothing” to address the threat of a fuel shortage.

Environmentalists panned the hearing featuring “an all-Canada witness list” as “political theater” from legislative leadership that has made no secret of its support for keeping the pipeline open.

“To get at the truth of the Line 5 threat in Michigan,” said David Holtz, spokesperson for the anti-Line 5 coalition Oil & Water Don’t Mix, “you would actually need to hear from credible people and organizations in Michigan who have analyzed and examined Line 5 and provided well-documented reasons for why Michigan’s priority around Line 5 should be Michigan.”

While most questions focused on giving Canadian officials a chance to air their concerns about a shutdown, some senators pressed Canada on the issue of the aging pipeline’s safety. Sen. Sean McCann, D-Kalamazoo, referenced the disastrous Line 6B disaster that spilled 843,000 gallons of crude oil from an Enbridge pipeline into the Kalamazoo River in 2010. 

“Can your government somehow guarantee that the continued operation of the existing pipeline will not result in a spill like the one Kalamazoo had in its backyard?” McCann asked.

Bailey noted that Enbridge invested in safety measures after the Kalamazoo spill, and argued that “the key” to protecting the straits is to build the underground tunnel that Enbridge has proposed as a safer replacement for the existing lakebottom lines.

Speakers made minimal mention of the 1977 treaty during Tuesday’s hearing, although Rossi told lawmakers “we fully expect the terms of that treaty to be upheld.”

Enbridge, too, has invoked the treaty in a federal lawsuit challenging the shutdown orders. The company has also argued that Michigan has no right to regulate pipeline safety, an area already covered by the federal Pipeline and Hazardous Materials Safety Administration. 

One expert in international law told Bridge on Monday that Canada and Enbridge have a strong argument against the state. In general, said Steven Ratner, Bruno Simma Collegiate Professor of Law at the University of Michigan, federal treaties supersede state law. 

“They are the supreme law of the land under Article VI of the Constitution,” he said, “and as a result, they do override any inconsistent state law.”

But the treaty has a few loopholes: For instance, it allows for pipeline flow to be “temporarily reduced or stopped” in the event of “an actual or threatened natural disaster, an operating emergency, or other demonstrable need.”

Whether or not Whitmer’s shutdown order falls into that loophole, Ratner said, could depend upon how a judge interprets the word “temporarily.”

Whitmer has repeatedly noted that Enbridge is free to continue pursuing a tunnel project that would replace the lakebottom span. But Enbridge is still awaiting permits for that project, and construction itself will take years.

So far, Whitmer and Nessel have not wavered from the shutdown order, and Biden administration officials have remained mum on their position.