Regulators asked to consider changes in Sandpiper pipeline path

Minnesota regulators will study shifting some segments of a proposed northern Minnesota crude oil pipeline in the face of public concern about the risk to lakes, wetlands and the Mississippi River headwaters.

But the state Commerce Department, which is overseeing an environmental review of Enbridge Energy's proposed Sandpiper pipeline, on Thursday said it doesn't endorse studying a wholesale reroute of the proposed $2.6 billion project to carry North Dakota crude oil.

State officials recommended studying 53 proposed adjustments to Enbridge's preferred route across northwest Minnesota to Clearbrook, then south to Park Rapids and east to an oil terminal at Superior, Wis. Alternate segments were proposed by residents, state environmental agencies and others to avoid sensitive areas or particular properties.

"Obviously we're dissatisfied with the decision," said Richard Smith, president of Friends of the Headwaters, an environmental group that has proposed shifting the entire Sandpiper's route south of Interstate 94.

Officials at the Minnesota Pollution Control Agency (MPCA), who also had recommended a new, southern route to avoid lakes and wetlands, said they were studying the recommendations of the Commerce Department and had no immediate comment.

More than 900 people and institutions have submitted 1,087 comments to state regulators about the proposed pipeline, and most were critical or opposed, according to the Commerce Department's analysis. Just 37 comments expressed "general support" for the project, the analysis found, while 459 expressed general opposition, and hundreds more had concerns about various environmental or other issues.

Lorraine Little, a spokeswoman for Calgary, Alberta-based Enbridge, said the company has been working to select the best route for the line and will continue to work with regulators on alternatives.

In August, the state Public Utilities Commission is expected to choose which alternatives should be studied further. That follow-up environmental study will be done with the assistance of HDR Engineering, an Omaha-based company with a Minneapolis office that has been awarded a $238,000 state contract. The work is expected to be completed and released in December.

The final decision on the route is expected next year after another round of public hearings.

Enbridge's preferred route for the pipeline has been criticized by environmental groups and questioned by the MPCA, which oversees spill cleanups, because it crosses a region of lakes, wetlands and wild rice beds. An MPCA analysis released in May found that the pipeline would cross 28 isolated water bodies where temporary access roads would need to be built before cleanup crews could begin to repair a rupture.

Commerce Department officials didn't endorse studying any of eight submitted proposals to entirely reroute the line to largely avoid the region. The department said in a regulatory filing that the PUC "may want to consider" whether to study modified versions of two total reroutes, including one submitted by the MPCA.

Ordering a study of an entirely new route would be an unprecedented step for regulators, although they have the authority to do so.

If regulators required the line to be built on an entirely new route, it would put Enbridge almost back to square one. The company already has spent about $100 million on project planning, according to a federal regulatory filing. And it's unclear whether an alternative route — likely to be longer and more expensive — could be commercially viable. The company has planned to complete the Sandpiper construction in 2016.

One of the rerouting alternatives was proposed by ­Sharon Natzel, a retiree who lives in a cabin on Long Lake near Park Rapids. Natzel said she worked at her kitchen table using an "Explore Minnesota" tourism map to identify an alternative northern corridor, which she submitted to regulators.

"I love water and I couldn't bear the thought of having a pipeline coming through our clearest lakes," she said.

Organic and sustainable farmers in Carlton County also have been worried about the pipeline's path. But an alternative route under consideration would avoid a dozen such farms.

"We are cautiously optimistic that our goals have been met," said Steven Schulstrom, co-founder of the Carlton County Land Stewards and co-owner of Spectrum Farm, which produces hay, maple syrup, poultry and pork.