Enbridge pipeline debate goes to decisionmakers

After more than three years of rancorous debate, Enbridge's quest to build a new $2.6 billion pipeline across northern Minnesota is finally in front of the decisionmakers.

The Minnesota Public Utilities Commission (PUC) on Monday begins deliberations expected to conclude by June 28 with a decision on the Canadian company's proposal to build a new pipeline that would replace its aging and corroding Line 3.

It's a high-stakes case even for the PUC, which is used to making decisions on big-ticket energy projects.

For Enbridge and its supporters, a new Line 3 is a necessary safety upgrade that will allow it to transport almost twice as much oil and better meet its customers' demands. The existing Line 3 can operate at just over half-capacity due to safety concerns.

"The biggest issue here is we have a critical piece of infrastructure that needs to be replaced," said Al Monaco, CEO of Calgary-based Enbridge, North America's largest pipeline operator. "It's just like we would replace a road, a bridge, a transmission line, a power plant."

To environmental groups and Ojibwe tribes, a new Line 3 is an ecological time bomb — a threat to lakes, rivers and wild rice waters — and a contributor to climate change.

The new pipeline "would go through areas with some of the highest water quality in the state," said Scott Strand, an attorney for Friends of the Headwaters. "If you have a spill, you will have a very difficult time bringing it back to where it was."

If Enbridge gets the green light, northern Minnesota could see a replay of the tense 2016 protests over the Dakota Access oil pipeline in North Dakota, which centered on American Indian water rights and climate change issues.

"It will be more than that," said Winona LaDuke, head of Honor the Earth, a Minnesota-based indigenous environmental activist group. "I am welcoming water protectors across the world to come to Minnesota this summer."

Line 3 in Minnesota would be part of a new pipeline that starts in Alberta's oil fields and ends at Enbridge's terminal in Superior, Wis. "It's the largest project we have ever done," Monaco said.

Line 3 is one of six Enbridge pipelines in a corridor that together transport at least 2.5 million barrels of oil per day. Most of it is shipped to markets well beyond Minnesota, though Enbridge supplies much of the oil used by the Twin Cities' two refineries.

The PUC's five commissioners will decide whether Enbridge merits a "certificate of need" for a new Line 3, and if so, what route the pipeline will take.

The Minnesota Department of Commerce represents the public before the PUC, and in September it concluded that a new Line 3 isn't needed. Its staff analysis found that Enbridge has enough capacity within its existing pipelines to meet long-term demand for oil.

In April, Administrative Law Judge Ann O'Reilly — appointed because this is a contested case in front of the PUC — disagreed. She concluded Enbridge had demonstrated a need for a new Line 3. The old one is in bad shape, and Enbridge must ration oil to shippers because it lacks sufficient pipeline capacity, a condition expected to continue, she found.

O'Reilly's other key recommendation: Despite the need for a new Line 3, Enbridge's proposed new route for the pipeline is a loser. She essentially said the environmental risks of the new route would outweigh the pipeline's benefits and recommended that Enbridge dig up its current Line 3 — a $1.2 billion job itself — and build a new one on the same route.

But that proposal faces a big roadblock. Enbridge's existing pipeline corridor crosses two Ojibwe reservations, and one of the bands — the Leech Lake Band — is adamantly against any new pipelines on its land.

Finally, the PUC staff this month offered a few short but potentially significant comments that said allowing Enbridge to build a new Line 3 would be better for the environment than continuing to rely on the existing pipeline.

Enbridge must frequently repair the 287-mile Line 3, conducting "integrity digs" to access and patch the pipe.

If the PUC rejects a new Line 3, Enbridge expects to spend around $2 billion over the next 15 years on integrity digs. "We would literally have to do thousands of them," Monaco said.

Due to its weakness, Line 3 can ship only 390,000 barrels of oil per day, well short of its 760,000-barrel capacity. The new pipeline would restore full flow and have a capacity of up to 915,000 barrels per day. (Enbridge must petition the PUC separately to go above 760,000 barrels.)

The proposed new Line 3 would be 53 miles longer than the current pipeline, following Enbridge's corridor to Clearbrook, Minn. From there it would jog south to Park Rapids before heading east to Wisconsin. It would parallel another oil pipeline to Park Rapids, but not beyond that point, opening that new region to oil spills, opponents say.

The new route, while it does not cross any Ojibwe reservations, does cross land where tribes claim treaty rights to hunt, fish and gather — including wild rice waters. Wild rice is sacred to the Ojibwe, and a source of food.

Recently, more than 500 religious leaders publicly opposed the new pipeline, including top officials of the Lutheran, Methodist, Episcopal and Congregational churches in Minnesota. They agree a new Line 3 would disproportionately harm the Ojibwe. "At its core, this is a moral issue," the ministers wrote in a letter to the PUC.

Environmental and tribal groups also see any new pipeline as a cog in a fossil fuel network that fosters climate change. Oil to be shipped on a new Line 3, Canadian bitumen, is the "dirtiest" oil, they say.

Bitumen, a thick crude, is mined, and then must be heated or diluted so it can flow through a pipeline. The process requires more energy than other forms of oil production, thus emitting more greenhouse gases.

"The climate change impacts are enormous," said Strand, the attorney for Friends of the Headwaters.

Kevin Pranis, a Line 3 supporter, said the pipeline itself is a "metaphor" for climate change, not its driver. "Pipeline sites are easy to mobilize around" for protesters, he said.

The Laborers and other building trades unions have pushed for the new line, which is expected to create more than 4,000 construction jobs. It would be one of the state's largest construction projects in several years, bigger than the $1.1 billion U.S. Bank Stadium, at least in dollar value.

The Minnesota Chamber of Commerce also has publicly supported a new Line 3.

So have governments in Minnesota counties that host Enbridge pipelines: A new Line 3 is expected to increase their tax revenue.