Up to $500M to replace Enbridge twin pipelines connecting Great Lakes

A new pipe is replacing a pair of 65-year-old crude oil pipes connecting two of the Great Lakes after Mich. Gov. Rick Synder's administration and Enbridge reached a deal.

This new pipe will run through a tunnel below the lake bed, according to officials.

The project is expected to take seven to 10 years to complete, costing anywhere from $350 million to $500 million — paid for by Enbridge, a company based in Calgary.

Meanwhile, about 87 million litres (23 million gallons) of oil and natural gas liquids used to make propane would move through the twin lines at the bottom of the straits.

Pipeline condition

These twin lines are part of Enbridge's Line 5, a system that spans 1,038 kilometres from Superior, Wis. to Sarnia, Ont.

Both parties have described the agreement as a win-win, as critics have considered the twin lines to be a time bomb that under a worst-case spill scenario, could negatively impact a large expanse of lakes and shorelines.

Enbridge has been on the defensive in recent years about the condition of the pipelines, following discoveries of dozens of spots where the protective coating has worn off. In addition, there was damage done from a ship anchor strike last April.

"This answers the demand we've heard from the public to protect the Great Lakes and at the same time provide some consistent reliability for energy," said Keith Creagh, director of the Michigan Department of Natural Resources.

The spokesperson for Enbridge, Ryan Duffy, said the company "has operated Line 5 safely and reliably for decades," although Synder and other officials have previously accused them of being less than forthcoming.

 "We believe this agreement makes a safe pipeline even safer," Duffy said.

'Sarnia's going to rejoice'

Dan McTeague, senior petroleum analyst for GasBuddy, called the Michigan approval good news for Sarnia, the heart of Canada's petrochemical industry.

"Sarnia's going to rejoice from this, as will the rest of us," he said, adding that if he were younger, he'd go into the trades and head to the city for work. "It means stable prices for fuel."

In addition to the economic benefit for Sarnia, McTeague said Line 5 is a critical component of Ontario's energy industry, explaining that it is the main source of light oil to Sarnia's three refineries.

"It's a fairly significant piece of pipeline — without it, I would estimate that well over two-thirds of all gasoline [in Ontario and Quebec] would simply disappear," he said.

Campaign issue

This deal may become a contentious topic during the election as Synder's term is winding down.

Democratic nominee Gretchen Whitmer has pledged to shut down Line 5 if she's elected as governor in November. Her Republican opponent, state Attorney General Bill Schuette, has endorsed the tunnel option.

On another note, environmental groups have been saying that the only safe course is to reroute the oil away from the straits.

"Michigan gets nothing in this deal except a continued unacceptable risk to our water, while Enbridge continues to rake in massive profits and use our state as a shortcut for Canadian oil," Sean McBrearty of Clean Water Action said during a Lansing, Mich. rally this week.

Vanessa Gray, an environmental and Anishinaabe activist from Aamjiwnaang First Nation, located near Sarnia, also called the pipeline a risk to fresh water. 

"I think that it's in everyone's best interest that this doesn't go through," she said. "We have to protect [our drinking water.]

Gray added that she believes Michigan doesn't have the legitimate authority to allow construction, calling the Great Lakes unceded territory.

It's not clear whether the next administration would have legal authority to undo the agreement to replace the pipes.

Michigan owns the straits bottomlands and granted Enbridge an easement when the pipes were placed in 1953. Creagh said revoking it would trigger a lengthy court battle.

Agreement details

The agreement includes provisions intended to reduce the likelihood of leaks from existing pipes while the tunnel is built. They also aim to ensure close collaboration between Enbridge and Michigan after the new line is operational, officials said.

Some of those collaborations include underwater inspections to detect potential leaks and evaluation of pipe coating. 

A deal also calls for negotiating a public-private partnership between Enbridge and the Mackinac Bridge Authority, a state agency that oversees the suspension bridge over the straits between Michigan's upper and lower peninsulas near the underwater pipes.

The authority would help Enbridge get government permits for the tunnel and new pipeline. They would also assume ownership of the tunnel when it's complete.

Enbridge will be leasing the tunnel for the pipeline.