Environmental groups seek enhanced studies of planned crude oil pipelines across Minnesota

Opponents of two crude oil pipelines proposed in northern Minnesota are pushing for deeper, more sweeping studies of their environmental risks in the wake of an appeals court ruling rejecting the process begun by state regulators.

The Minnesota Public Utilities Commission on Thursday decided to stay, or put on hold, its June decision granting a certificate of need to the proposed $2.6 billion Sandpiper pipeline to carry North Dakota oil across Minnesota on its way to refineries in other states.

But the five-member commission left open what happens next with the project, which is entering a second stage of state review that focuses on its route. What ultimately happens with the Sandpiper project also could affect another proposed pipeline, Line 3, which has overlapping environmental issues because it's proposed on the same route by the same pipeline company.

"The hope is the commission will take this opportunity to take a broader look at pipelines in Minnesota," said Kathryn Hoffman, an environmental attorney in St. Paul who successfully argued before the Minnesota Appeals Court that state utility regulators were required to do an environmental impact study of Sandpiper before deciding whether the project is needed.

Calgary-based Enbridge Energy, which is proposing the two pipelines, still has the option of appealing the Sept. 14 ruling, as does the utilities commission. Neither has decided whether to take that step, which could mean a lengthy delay. In the meantime, the five-member commission asked Enbridge and its supporters and critics to comment on what to do next in the wake of the ruling.

Hoffman and others, including the White Earth Band of Ojibwe, want the state to conduct a full-scale environmental impact statement (EIS) that carefully studies the cumulative risks of crude oil pipelines, examines alternate routes that don't cross sensitive and isolated wetlands and avoids wild rice lakes and the headwaters of the Mississippi River.

That kind of review, which was used for TransCanada's stalled Keystone XL crude oil pipeline through western states, has more procedural steps than the process long used on Minnesota pipelines. In an EIS a draft report is prepared, often resulting in several volumes of material. The draft is subject to comments and questions that must be addressed in a final report. The process can take years, as it has for Keystone XL and the proposed PolyMet Mining Corp. copper-nickel mine near Hoyt Lakes, Minn.

"This is the [Gov. Mark Dayton] administration's Keystone XL," Hoffman added.

Although an appeals court panel said the commission erred by not doing an environmental study before deciding the need for the pipeline, that doesn't automatically shift the Sandpiper review into a full EIS. The commission could fall back on a version of its usual process, with its streamlined environmental assessment. That normally is done before the commission votes on the need for the project and the route. Courts have accepted that process as adequate.

"I don't want to see a scenario where stalling becomes the order of the day," said Commissioner Betsy Wergin, who on Thursday proposed immediately reverting to the commission's usual procedure.

But other commissioners didn't agree and chose instead to seek comments from Enbridge, pipeline activists and others on how to proceed. Enbridge has said it favors a return to the state's standard pipeline review, which the company hoped would lead to the start of construction on Sandpiper next year. Now that timeline is no longer certain.

The 210-mile Minnesota segment of the Sandpiper would run from North Dakota's border to an oil terminal in Clearbrook, Minn., then jog south toward Park Rapids along an existing pipeline right of way and turn east to Superior, Wis., partly following an electric transmission line.

Line 3 is a separate, equally expensive Enbridge project to replace a 1960s-era crude oil pipeline from Canada that has a history of leaks. Much of the new, northern Minnesota segment of Line 3 would be built along the proposed Sandpiper corridor.

Hoffman, the environmental lawyer representing Park Rapids-based Friends of the Headwaters, said state regulators should take the opportunity to thoroughly study these projects. She said the Minnesota Pollution Control Agency (MPCA) and Department of Natural Resources (DNR), which have submitted critical comments about the pipeline projects, should be enlisted to take a more active role.

This week, both agencies expressed fresh concerns about Enbridge's preferred route. The MPCA said pinhole pipeline leaks in remote areas could release up to 28 barrels of oil per day "yet go unnoticed for months because the leak is too small to be detected by pipeline leak detection equipment." Both agencies reiterated earlier suggestions to study pipeline paths further south, and the DNR offered a way to avoid Detroit Lakes, which is on one of the alternates.

Enbridge has opposed suggestions to reroute the line away from Clearbrook and Superior, saying such alternatives would not meet oil shippers' needs. Lorraine Little, spokeswoman for Enbridge, said in an e-mail that conducting additional environmental analysis on routes that do not meet the need would be inefficient.

Two more groups are putting legal firepower into the pipeline battle, including the Mille Lacs Band of Ojibwe, owner of two casinos in Minnesota. The band's Minneapolis law firm, Lockridge Grindal Nauen, filed to intervene this week. Separately, the Sierra Club has brought in Paul Blackburn, a Minneapolis environmental attorney, to fight against Line 3.

David Shaffer • 612-673-7090