Minnesota regulators opened the door Thursday to considering an all-new route for Enbridge Energy's proposed Sandpiper crude oil pipeline across northern Minnesota.
Over the objections of the Calgary-based pipeline company, the state Public Utilities Commission (PUC) unanimously agreed to study a southern route proposed by a state agency to avoid the headwaters of the Mississippi River and a large swath of lakes, wetlands and wild rice areas.
The $2.6 billion project is designed to bring North Dakota crude oil to Enbridge's terminals at Clearbrook, Minn., and Superior, Wis., and promises more than 1,500 temporary construction jobs and the potential to reduce the amount of oil moving on trains.
Regulators didn't toss out Enbridge's original plan, but decided that one suggested by the Minnesota Pollution Control Agency deserved to be studied as a potential alternative. That review will take months, and the final choice of routes won't happen until next year.
The decision on Thursday came after five hours of testimony from various interests, including environmental groups who oppose Enbridge's plans and unions who wanted no further delay. About 45 anti-pipeline activists protested outside the commission's office in St. Paul before the hearing began.
"It has highlighted some serious environmental, human, socioeconomic and cultural as well as legal issues,'' said Commissioner Dan Lipschultz.
The commission left the door slightly open on seven other alternative routes that Enbridge opposed, some of which don't go where the company intends to deliver crude oil. Regulators plan to collect more information and public comments about those routes, and decide later whether they could meet the need to transport oil to market.
"We are reasonably pleased," said Richard Smith, president of the Friends of the Headwaters, a Park Rapids-based group formed last year to oppose the pipeline through that area.
It was a setback for Enbridge, which said all the alternate routes would be longer and more costly and considering them could delay the pipeline by three years. The company had hoped to have it in operation in 2016.
"We need more time to digest the outcome of the proceedings," Enbridge spokeswoman Lorraine Little said after the decision. "We are open to a process that is efficient and transparent but at the same time keeps the need and purpose of the project at the forefront."
Enbridge agreed to submit a report on its safety record to an administrative judge who is reviewing the project.
Besides the controversial all-new routes, the commission agreed to study 53 modifications proposed by landowners, environmental groups and others to Enbridge's preferred route. Enbridge didn't oppose that process, which is standard in pipeline and transmission projects.
Potentially thousands of people along the alternative southern route now will be contacted, so they know the study is underway and their property might be affected. That route would parallel existing natural gas and petroleum pipelines.
Enbridge's proposed route for the Sandpiper project takes a Z-shaped path through northern Minnesota. From North Dakota, it runs into Clearbrook, Minn., turns south toward Park Rapids along existing crude oil pipelines, and then east to Superior.
That route has been criticized by environmental groups and two state environmental agencies.
Winona LaDuke, founder of Honor the Earth, an environmental group that opposes Enbridge's planned route, said it puts at risk her organic wild rice operation on Lower Rice Lake in Clearwater County. "Our water is worth more than their oil," LaDuke said.
But Kevin Pranis of the Minnesota/North Dakota Laborers' Union, whose members stand to get jobs on the project, spoke against studying alternatives that "don't make a lot of sense" because they don't take oil where Enbridge intends to deliver it.
Pranis said North Dakota oil already is moving through Minnesota — on trains every day.
"That poses in my mind significantly greater risks," he said. "The standards in place for rail lines, even the new ones being put in place for tank cars, are nowhere near the standards in place for pipelines."