State regulators OK controversial Enbridge pipeline project

State regulators on Thursday approved a $2.6 billion pipeline that the Canadian oil company Enbridge wants to build across northern Minnesota, the crucial step on a project that environmental groups and several American Indian bands fiercely oppose.

American Indian activists vowed large-scale protests as early as this weekend against the project, as Gov. Mark Dayton urged people on all sides of the issue to "express themselves peacefully."

The Public Utilities Commission voted 5-0 to grant Enbridge a "certificate of need" to build a replacement for its 1960s-vintage Line 3, and commissioners said the decaying state of the current pipeline drove the decision.

The commission also approved, by a 3-2 vote, Enbridge's proposed pipeline route, with one alteration in the Big Sandy Lake region in Aitkin and Carlton counties. The change moves the pipeline farther away from the lake, which has particular cultural and historic importance to the Ojibwe bands.

"This is an especially difficult decision for me to make, and it has no good outcome," Commissioner Katie Sieben said before she cast her vote on the certificate of need. She, along with Commissioner Dan Lipschultz, voted against the route.

Sieben, like other commissioners, said the new pipeline was part of a consent decree with federal agencies and was necessary to ensure an adequate oil supply to Minnesota's refineries because the current Line 3 is corroding and running at only half capacity.

The existing line "is in horrifying condition and is deteriorating rapidly," Commissioner Matt Schuerger said. "The trend of this condition is startling."

PUC Chairwoman Nancy Lange choked up during discussion of the pipeline, momentarily wiping her eyes. "How would I feel if I woke up in five years and found out that [the current Line 3] had leaked? It is just too great a cost."

Pipeline supporters have stressed the economic benefits of the project. Environmental groups, some local property owners' associations and several Indian bands have said a new Line 3 would exacerbate climate change and open a new region of Minnesota lakes, rivers and wild rice waters to degradation from possible oil spills.

Emotions were heightened throughout five days of PUC hearings on the project. Outbursts came from the crowd as it became clear the PUC would vote in favor of the project. Tania Aubid, a member of the Mille Lacs Band of Ojibwe, shouted, "You have just declared war on the Ojibwe."

At one point, about 35 activists gathered outside the downtown St. Paul building where the hearing was held to decry the decision. Some stood on the street corner and yelled, "Water is life!" as cars passed by.

Nicolette Slagle, deputy director of Honor the Earth, said she was not surprised by the decision but added the approval would result in "turmoil" in Minnesota this summer. The group said it will organize protests south of Duluth near where the pipeline would cross the Minnesota-Wisconsin border.

"This is just the first step," he told a crowd during a news conference.

Scott Strand, attorney for Friends of the Headwaters, said an appeal is likely. "We think the PUC has unfortunately let the short-term interests of Canadian oil producers outweigh the long-term public interest of Minnesotans in preserving our water resources and recognized tribal treaty rights."

Enbridge's preferred Line 3 route would not cross any reservations, though it would traverse land where the Ojibwe claim treaty rights to hunt, gather and fish. Four of the five largest Ojibwe bands in Minnesota have firmly opposed any new pipeline. The Leech Lake Band of Ojibwe has stated that it would rather see a new pipeline than the continued operation of the current Line 3, which crosses its reservation.

The route alteration approved by the PUC will not be clear for at least 60 days. The shortest path to avoid Big Sandy Lake and hook up with Enbridge's Line 3 corridor would mean building the new pipeline partly on the Fond du Lac Reservation. But the band has been opposed to any new Line 3 and would need to approve it. A longer path bypassing the reservation was also a possibility.

Enbridge CEO Al Monaco said in a statement that he was "very pleased" with the PUC's decision.

The project's supporters — among them Enbridge's customers, labor unions and Minnesota counties that will host the pipeline — point to the more than 4,000 construction jobs and new tax revenue the project would create.

Bob Schoneberger — CEO of Duluth-based United Piping, which works on Enbridge pipelines, and head of Minnesotans for Line 3, a pro-pipeline group — said spinoff economic effects will include hotel stays and contracts for supply companies and equipment maintenance companies.

House Speaker Kurt Daudt, R-Crown, supported the PUC decision. "Unfortunately, too many extreme environmentalists ... have threatened violent protests to disrupt construction. I hope Democrats will join Republicans in condemning threats of violence and stand with the Minnesota laborers who will be building this pipeline."

While the PUC's decision is by far Enbridge's biggest hurdle, it's not the last before the company can begin construction on the 340-mile pipeline. In addition to a possible appeal, the company still must get 29 required state, local and federal permits, including those to cross waterways from the U.S. Army Corps of Engineers.

Before those permits are issued, a tribal cultural survey of the pipeline route must be completed. The study, which aims to document Indian cultural and historic sites, is being led by the Fond du Lac Band of Lake Superior Chippewa. It's expected to be completed by the fall.

The decision caps a process that began as an Enbridge gambit to build two new pipelines in Minnesota, both along the same new route.

The other pipeline, Sandpiper, would have transported oil from North Dakota to Superior. But after considerable opposition combined with a decline in the oil market, Enbridge shelved that project in 2016, opting instead to buy a piece of the Dakota Access pipeline.

The project also fulfills terms in a consent decree Enbridge signed in 2016 with the U.S. Department of Justice and the Environmental Protection Agency in the wake of a massive Enbridge pipeline spill in Michigan that cost over $1 billion to clean up. The consent decree ordered Enbridge to replace Line 3, if it could get state regulatory approval to do so.

Includes reporting by staff writers Nicole Norfleet and Erin Golden.

Mike Hughlett • 612-673-7003