Page 5 - NorthAmOil Week 19 2021

NorthAmOil COMMENTARY NorthAmOil

Indeed, Line 5 is not only an interstate pipe- in court-ordered mediation, with the next ses-
line but a cross-border one too, running from sion scheduled for May 18, but the process is still
Wisconsin to Ontario, Canada, via Michigan. in its early days and does not yet appear to have
This week, the government of Canada, which moved them any closer to a resolution.
has long been supportive of Enbridge in this In the meantime, Enbridge has insisted
case, issued its most strongly worded state- that it will keep operating the pipeline unless
ment on Line 5. In a federal court filing, Ottawa a court or regulatory ruling prevents it from
warned that shutting down Line 5 would “harm” doing so.
the relationship between Canada and the US, as “We will not stop operating the pipeline
well as causing fuel shortages, price spikes and unless we are ordered by a court or our regu-
layoffs. Additionally, the Canadian government lator, which we view as highly unlikely,” an
warned that if Michigan were to force a shut- Enbridge spokesman, Ryan Duffy, was quoted
down, it would contravene a 1977 treaty that by the Associated Press as saying this week.
guarantees the free flow of oil between the two “Line 5 is operating safely, reliably and is in com-
countries. pliance with the law.”
“This case raises concerns regarding the effi- However, Michigan is expected to retaliate
cacy of the historic framework upon which the against Enbridge’s refusal to comply with the
US-Canada relationship has been successfully shutdown order. In a letter to Enbridge’s exec- Michigan is
managed for generations,” Ottawa said. It added utive vice-president for liquids pipelines, Vern
that Michigan’s move “threatens to undermine Yu, this week, Whitmer warned that continuing expected to
important aspects of that co-operative interna- to operate Line 5 after May 12 would constitute retaliate against
tional relationship”. an “intentional trespass”. If the company chose
The Canadian government’s brief has urged to keep the segment operating, it would be Enbridge’s refusal
further efforts by Enbridge and Michigan to doing so “at its own risk”, she added.
reach a settlement. It is also calling for the shut- “If the state prevails in the underlying litiga- to comply with
down order to be suspended while the US and tion, Enbridge will face the prospect of having
Canada discuss whether closing the pipeline to disgorge to the state all profits it derives from the shutdown
would violate the 1977 treaty. its wrongful use of the easement lands following order.
For her part, US Secretary of Energy Jennifer that date,” Whitmer said.
Granholm – a former Michigan governor – has There is still considerable uncertainty over
not publicised her administration’s position how the court battle will play out, but if Mich-
on the dispute, saying this week that it remains igan ultimately succeeds in having Line 5 shut
before the courts. down, this could have worrying implications
for other pipelines that are already operational.
What next? Enbridge – and the industry more broadly –
Whitmer’s order needs a confirmatory ruling will have to hope that the litigation goes in its
from a judge to enforce it, and a federal judge favour. Certainly, the company’s actions sug-
currently weighing which court – state or federal gest that it will do everything in its power to
– should have jurisdiction. The two sides are also keep Line 5 running.™

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