Minnesota PUC approves Enbridge's Sandpiper pipeline but didn't settle its route

Minnesota regulators on Friday endorsed a controversial northern Minnesota pipeline to carry North Dakota's crude oil, but left open the prospect of shifting its course away from northern lakes.

The 5-0 vote by the state Public Utilities Commission (PUC) grants pipeline developer Enbridge Energy a certificate of need to construct the $2.6 billion Sandpiper pipeline from the Bakken oil fields to Superior, Wis.

North Dakota earlier approved its half of the 610-mile pipeline.

The Minnesota decision was only a partial victory for the Calgary-based pipeline company, which still faces a monthslong review of its preferred route and an alternate that it opposes.

"We appreciate the Public Utility Commission's unanimous decision," said Enbridge spokeswoman Lorraine Little. "It is a great step forward."

Environmentalists who wanted the line to be shifted from the headwaters of the Mississippi River were disappointed. The alternate route to be studied would still go through the region near Itasca State Park.

"The commissioners put the needs and profits of a private, foreign company ahead of Minnesota's pristine, historically and economically valuable headwaters of the Mississippi," said Richard Smith, a founder of Friends of the Headwaters, a citizens group that pushed for a more southern route.

The PUC decision came a day before anti-pipeline groups are planning a St. Paul march that they expect to draw thousands, ending with a rally at the State Capitol.

In its order, the commission encouraged state officials who will oversee an in-depth environmental study of possible routes to consider additional protections for waterways, such as thicker pipes and additional shut-off valves in critical areas.

"I don't think we can be too careful," said commission Chairwoman Beverly Jones Heydinger. "This is a very big project. It is going through some very sensitive areas that are important to everyone in the state of Minnesota. We know that an in-depth review is necessary."

The route Enbridge prefers would run 299 miles across the state, from the North Dakota border to a Clearbrook, Minn., oil terminal. It would continue south toward Park Rapids, parallel to existing crude oil pipelines, and then east to Superior, partly along a transmission line. The alternate would follow the same path to near Park Rapids, then head southeast, parallel to a natural gas pipeline, to North Branch, and turn northeast to Superior, Wis. It would miss the lakes region east of Park Rapids.

Enbridge has opposed alternatives proposed by environmental groups, saying they also are longer, more costly, carry environmental risks, and are closer to people and water supplies.

In a separate vote, the commission rejected a request from Honor the Earth, an environmental group led by American Indian activist Winona LaDuke, to combine the final review of the Sandpiper project with the review of another pipeline that Enbridge wants to build on the same route. But regulators agreed to study the effect of having two new pipelines instead of just one.

To address safety concerns, Enbridge has agreed to various conditions, including building roads to all shut-off valves, offering financial proof that it has money to clean up spills and training local emergency responders.

The project would be one of the largest construction efforts ever in Minnesota and has many supporters, including unions and the Minnesota Chamber of Commerce. Dozens of legislators and most county commissioners along the route have endorsed it, as have cities like Elk River, where oil trains are seen as a risk.

"The commission decided a pipeline is a far more desirable alternative for Minnesotans than the current use of rail," said Kevin Pranis, organizing director of the Minnesota/North Dakota Laborers union. "There are no easy places to put a pipeline that don't have impacts."

Yet the claim by some supporters that pipelines could end oil trains in Minnesota also drew criticism. North Dakota ships most of is 1 million barrels of daily output by rail, sending up to 50 oil trains through the state weekly.

"It may also reduce some current congestion," Commissioner Nancy Lange said. "To say 'eliminate' is setting up false expectations for what this project will do."

At one point Friday, the commission voted 3-2 on a motion that would have kept alive the option of entirely rerouting the Sandpiper line and avoiding the Mississippi River headwaters. But a second vote was needed for procedural reasons, and Lange said she had changed her mind, killing that option.

Lange, a former staff member of the Izaak Walton League, said the "sole reason" for her reversal was that state agencies, including the Minnesota Department of Natural Resources, have limited staff resources to study an entirely new route. "Adding another route significantly strains those resources," Lange he said.

It's not clear how long the next phase of the regulatory review will take. It will require additional hearings, studies and a PUC vote for a route permit. Enbridge hopes the pipeline will be under construction in 2016 and finished the following year. The project will employ 1,500 temporary construction workers.

Anti-pipeline protesters are hoping to draw thousands of people Saturday to St. Paul for the march and rally focused on Enbridge's plan for a second crude-oil pipeline along its Sandpiper route. That project, which is in the early stages of review, would replace and expand a leak-plagued 1960s-era pipeline, called Line 3, that carries Canadian oil to Superior.

Protest organizers compare that line to the controversial Keystone XL pipeline that TransCanada proposes to build through western states. Both pipelines would carry heavy oil from Alberta's tar sands.

Bill McKibben, founder of the climate change group 350.org, is speaking at the rally. He led the anti-Keystone protests at the White House in 2010.

"This is a powerful moment," McKibben said earlier this week. "Minneapolis and St. Paul is absolute ground zero for the biggest movement of the year. There's no longer any doubt about what's going on" with climate change.

Staff writer Josephine Marcotty contributed to this article.

David Shaffer • 612-673-7090 • @ShafferStrib