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Canada says Line 5 closure would violate 1977 treaty, requests diplomatic negotiations

Highlights

Canada asks to suspend court activities pending diplomatic talks

Court-ordered mediation between Enbridge and Michigan at a standstill

The Canadian government said Oct. 4 it is requesting diplomatic negotiations with the US to keep Enbridge's Line 5 crude and propane pipelines open in Michigan, arguing that any court-ordered closure would violate a 1977 international treaty regarding transit pipelines.

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Canada's federal court filing in the Western District of Michigan comes after court-ordered mediation between Canadian pipeline operator Enbridge and the state of Michigan hit a standstill. Democratic Michigan Gov. Gretchen Whitmer previously ordered the 540,000 b/d pipeline shuttered for alleged safety violations, while Enbridge has defiantly kept Line 5 flowing unless ordered by a federal court to close it.

However, the Canadian government is now formally invoking the 1977 treaty and requests diplomatic negotiations with the Biden administration. Canada's legal counsel, Gordon Giffin, wrote that the treaty forbids any public authority from either country, including Michigan, from interfering with the transmission of oil and gas. Line 5 is a major provider of propane for heating in the US Midwest and eastern Canada.

Canada is asking Judge Janet Neff of the Western District of Michigan to suspend the court case until the requested treaty negotiations are completed.

In September, the state of Michigan said it had "no desire to continue with the mediation process" and asked the judge to consider the mediation process as "completed without a settlement." However, while Judge Neff acknowledged the "standstill," she stated that the "parties remain under a continuing obligation to engage in good faith to resolve this case."

While Gov. Whitmer has pushed to permanently close the 68-year-old, twin pipelines for safety reasons, Enbridge's plan is to build a tunnel under the Great Lakes' Straits of Mackinac to make Line 5 safer long term.

The 645-mile pipeline system stretches from Wisconsin through Michigan and into Ontario and is part of Enbridge's larger Mainline and Lakehead networks.

On Oct. 4, Enbridge said it appreciated the Canadian government's efforts.

"We have spoken with government officials on both sides of the border as the state of Michigan has let parties know it is not committed to further mediation," said Enbridge spokesman Ryan Duffy in a statement. "Enbridge has continued to participate in the mediation process in good faith and still is hopeful that a negotiated resolution will continue to provide consumers and industry in the region with safe, reliable energy and advance the quick construction of the tunnel at the Straits of Mackinac."

Brewing feud

Enbridge had hoped to start construction on the tunnel project by the end of this year and complete it in 2024. The tunnel would go under the Straits of Mackinac, a 4-mile-wide channel linking Lake Huron and Lake Michigan.

However, in June, the US Army Corps of Engineers said it would require an environmental impact statement for the Line 5 tunnel replacement, likely delaying it at least until 2025.

Previously, US Energy Secretary Jennifer Granholm said the Biden administration is deferring to the courts and staying out of the pipeline fight. But that neutral stance may not prove tenable for much longer.

In his first year in office, Biden has taken a mixed-bag approach to pipelines and fossil fuels. He essentially canceled the infamous Keystone XL Pipeline project from Canada, but he allowed Enbridge to complete the competing Line 3 replacement project, which just came online Oct. 1, nearly doubling the pipeline's capacity into the US.

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

The pending court battles have largely rested on whether Line 5 is primarily under federal or state regulatory oversight.

Michigan is suing to revoke the pipeline's original 1953 easement and close the propane system. Enbridge is countersuing for an injunction against Whitmer's shutdown order, arguing the US Pipeline and Hazardous Materials Safety Administration is instead in charge of the pipeline's safety.