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Enbridge will defy Michigan Line 5 pipeline shutdown orders in advance of court battle

January 26/2021

MOSCOW (MRC) -- Enbridge said it will defy the state of Michigan's order to shut down its Line 5 crude oil and propane pipeline system by May, and will instead challenge Gov. Gretchen Whitmer's permitting revocation in federal court, reported S&P Global.

Enbridge's Jan. 12 letter to the Democratic governor comes in response to Whitmer's decision in November 2020 to yank the Line 5's 1953 easement from when the pipeline system first came online, citing safety violations. In doing so, Whitmer said the dual pipelines had to close by May. The state also filed a lawsuit seeking legal recognition of the shutdown order.

Whitmer and Enbridge have maintained a confrontational relationship since she took office in the beginning of 2019, and tensions escalated last summer when the 540,000 b/d Line 5 was partially shuttered for much of this summer after an anchor support for the pipeline was damaged and eventually repaired.

The 645-mile line stretches from Wisconsin through Michigan and into Ontario, and is part of Enbridge's larger Mainline and Lakehead systems. Enbridge's planned Line 5 tunnel replacement project under the Great Lakes' Straits of Mackinac has progressed despite state opposition, although project completion is not expected until late 2024, according to Enbridge.

In terms of the more immediate fight, Enbridge said it has no intention of shutting down the Line 5 system because it said the state's unspecified allegations are baseless.

"Our dual lines in the Straits are safe and in full compliance with the federal pipeline safety standards that govern them," wrote Enbridge executive vice president Vern Yu in the response letter. "In the meantime, the dual pipelines will continue to operate safely until they are replaced on completion of the Tunnel Project."

Enbridge claimed the state lacks the authority to terminate or revoke the 1953 easement, and that Enbridge is in full compliance with revised safety agreements approved in 2017 and 2018 with the state under the previous Republican governor, Rick Snyder.

Enbridge added that the pipeline was reviewed and approved for operation by the US Pipeline and Hazardous Materials Safety Administration last year after the necessary repairs were made following the anchor support accident.

Enbridge is asking a federal court to dismiss the state's easement revocation.

"To make matters worse, the state of Michigan has offered no short-term or long-term plans for alternative propane or energy supply should Line 5 be shut down," Enbridge spokesman Michael Barnes added in a statement.

In yanking the easement in November, Whitmer cited "persistent and incurable violations of the easement's terms and conditions," including structural issues with the dual pipelines that provide Michigan customers with more than half of their propane supplies.

"Enbridge has imposed on the people of Michigan an unacceptable risk of a catastrophic oil spill in the Great Lakes that could devastate our economy and way of life," Whitmer said in a Nov. 13 statement. "That's why we're taking action now, and why I will continue to hold accountable anyone who threatens our Great Lakes and fresh water."

There's been greater scrutiny of Enbridge in Michigan since a significant 2010 oil spill from a separate Enbridge pipeline along the Kalamazoo River.

At the time, Alberta Energy Minister Sonya Savage called the move by Whitmer the latest in her "long-standing efforts" against Line 5. Savage predicted a "long, protracted process in the American court system."

Energy analysts have contented there is a low likelihood of the pipeline actually shuttering this spring given the protracted legal fight involved.

Enbridge reiterated that it is offering to meet with state officials to resolve any differences.

As MRC wrote previously, in late December 2019, Enterprise Products Partners and Enbridge agreed to jointly develop a deepwater crude oil export terminal offshore Houston, the latest sign of consolidation in the crowded field of US Gulf Coast export projects.

We also remind that Enterprise Products Partners' Mont Belvieu propane dehydrogenation unit in Texas restarted from planned maintenance in the first week of December, 2019. The PDH unit went offline for maintenance on November 13. That day, the company said in a filing with the Texas Commission on Environmental Quality that the RAC "B" turbine shut down, which resulted in flaring. The flaring was estimated to last 72 hours. The unit has a capacity of 750,000 mt/year of propylene.

Propylene is the main feedstock for producing polypropylene (PP).

According to MRC''s DataScope report, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
Author:Margaret Volkova
Tags:PP, homopolymer PP, propylene, gas processing, petrochemistry, Enterprise Products, Canada, Russia, USA.
Category:General News
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