Intense interest in $2.6B Enbridge pipeline spurs rare comment session for Minnesota regulators

Enbridge's proposed new $2.6 billion Minnesota oil pipeline is back before state utility regulators — possibly for the last time — after the completion of court-ordered changes to a key environmental review.

The Minnesota Public Utilities Commission (PUC) will kick off up to three days of hearings on the controversial 340-mile pipeline with a public comment session Friday. Though the new pipeline — a replacement for the aging Line 3 — has already prompted a deluge of public input, it's rare for PUC commissioners to take direct comments from the audience on any issue.

"There is intense public interest in this case, and as chair of the commission, it seemed reasonable to provide an additional avenue for the public to share their thoughts on the revised [environmental study] and the project in general," the PUC's Katie Sieben said in an e-mail.

After more than three years of regulatory wrangling, the PUC in March 2018 unanimously signed off on the project's environmental impact statement (EIS) and two months later gave final approval by issuing a certificate of need. But in June, the Minnesota Court of Appeals shot down the PUC's acceptance of the EIS, throwing the project into limbo.

The Minnesota Department of Commerce has since revised the environmental study, analyzing the effects of a potential future oil spill into the Lake Superior watershed — as ordered by the appellate court. The PUC will vote early next week on whether to approve the revised EIS.

But the regulators could go further.

The PUC also will consider whether to reissue — on the spot — its previous approvals of the entire project, or to ask for more comments before ultimately deciding on the "certificate of need" and "route permit" for a new Line 3.

Environmental groups favor the latter. "We believe [Minnesota environmental] law requires that the PUC gives people the chance for additional comments," said Paul Blackburn, an attorney for Honor the Earth, one of the environmental groups opposing the pipeline.

Calgary, Alberta-based Enbridge and its supporters want the full project approved next week, not just the EIS.

"Nothing has changed here, except that [the current Line 3] is more than a year older," said Kevin Pranis, Minnesota and North Dakota marketing manager for the Laborers union. Pranis said he's anticipating a June start to construction on the new pipeline.

Even if the PUC pushes through approvals next week, Enbridge still must receive more technical permits from the Minnesota Pollution Control Agency (MPCA) and the state's Department of Natural Resources (DNR). Neither agency can issue those until the revised EIS is approved. Enbridge must also get a permit from the U.S. Army Corps of Engineers.

The MPCA said it is reviewing Enbridge's water-permit application and expects to issue a revised permit schedule in early February. The DNR also said it is reviewing permit applications and that any approvals would not occur until after the PUC approves Line 3 and its route.

The existing 1960s-vintage Line 3 is corroding and operating at 51% of capacity due to safety concerns. Enbridge said safety would be greatly enhanced with a new pipeline, which would also restore the full flow of oil — 760,000 barrels per day — and boost Enbridge's profits.

Opponents of the New Line 3 said it would exacerbate climate change and open a new region of lakes, rivers and wild-rice waters to degradation from oil spills.

New Line 3, an artery to Alberta's oil fields, would follow Enbridge's existing corridor of pipelines across northern Minnesota to Clearbrook. But from there, it would forge a mostly new path to Enbridge's terminal in Superior, Wis.

Pipeline opponents appealed the PUC's approval of the EIS on several fronts. In turn, the appellate court rejected the voluminous EIS on one small but important aspect: It failed to properly address effects of a potential oil spill in the Lake Superior watershed.

So, the Minnesota Department of Commerce redid that part of the EIS and concluded an oil spill in the Lake Superior watershed would be unlikely to reach the lake itself.

The Commerce Department did its spill modeling on a pipeline crossing at Little Otter Creek in Carlton County, the location where a spill in Minnesota would be most likely to enter the St. Louis River and reach the lake. In a "full-bore" rupture at Little Otter Creek, oil would likely accumulate on the river's shores "but without reaching the entrance to Lake Superior," according to the revised EIS.

Honor the Earth, the Sierra Club and Friends of the Headwaters all argue in PUC filings that the EIS is still faulty. Among other things, they argue that the Little Otter Creek site understates the risks of a pipeline rupture to Lake Superior. Spills at other locations should also be modeled, they argue.

All three groups particularly point to pipeline crossings in Wisconsin, at the Pokegama and Little Pokegama rivers, which are much closer than Little Otter Creek to the St. Louis River. Spills at those crossings could do major damage in Minnesota, they said.

Enbridge said in a statement that the appeals court confirmed the propriety of the Little Otter Creek site, and that Wisconsin did its own environmental review of the pipeline. The 14-mile stretch of the Line 3 replacement in Wisconsin has already been built and opened in May 2018.

Environmental groups argue that Wisconsin's environmental review was generic as far as oil-spill analysis, lacking a rigorous evaluation of a rupture in the Lake Superior watershed. The groups noted the Minnesota Court of Appeals in December shot down another PUC decision that also pertains to energy infrastructure in Wisconsin.

Minnesota Power wants to build and co-own a $700 million natural gas-fired power plant in Superior, which was approved by the PUC in 2018. But that decision was challenged by environmental groups, which claimed the PUC failed to properly review the Minnesota environmental effects of the Superior gas plant. The court agreed.