Enbridge to spend $177-mn to settle claims of 2010 oil spills in Michigan, Illinois

The US Environmental Protection Agency (EPA) and the Department of Justice on Thursday announced a settlement with Enbridge Energy Limited Partnership and several related Enbridge companies to resolve claims stemming from its 2010 oil spills in Marshall, Michigan and Romeoville, Illinois.

Enbridge Energy has agreed to spend at least $110 million on a series of measures to prevent spills and improve operations across nearly 2,000 miles of its pipeline system in the Great Lakes region. Enbridge will also pay civil penalties totaling $62 million for Clean Water Act violations - $61 million for discharging at least 20,082 barrels of oil in Marshall and $1 million for discharging at least 6,427 barrels of oil in Romeoville.

In addition, the proposed settlement will resolve Enbridge's liability under the Oil Pollution Act, based on Enbridge's commitment to pay over $5.4 million in unreimbursed costs incurred by the government in connection with cleanup of the Marshall spill, as well as all future removal costs incurred by the government in connection with that spill.

Thursday's settlement includes an extensive set of specific requirements to prevent spills and enhance leak detection capabilities throughout Enbridge's Lakehead pipeline system - a network of 14 pipelines spanning nearly 2,000 miles across seven states. Enbridge must also take major actions to improve its spill preparedness and emergency response programs.

Under the settlement, Enbridge is also required to replace close to 300 miles of one of its pipelines, after obtaining all necessary approvals. Enbridge's Lakehead System delivers approximately 1.7 million barrels of oil in the United States each day.

''This agreement puts in place advanced leak detection and monitoring requirements to make sure a disaster like this one doesn't happen again," said Cynthia Giles, assistant administrator for EPA's Office of Enforcement and Compliance Assurance. "This comprehensive programme – including an independent third party to audit compliance – will protect our waterways and the people who depend on them."

''This settlement will make the delivery of our nation's energy resources safer and more environmentally responsible,'' said assistant attorney general John C Cruden for the Justice Department's Environment and Natural Resources Division. ''It requires Enbridge to take robust measures to improve the maintenance and monitoring of its Lakehead pipeline system, protecting lakes, rivers, land and communities across the upper Midwest, as well as pay a significant penalty."

In addition to payments required under the proposed settlement, Enbridge has already reimbursed the government for $57.8 million in cleanup costs from the Marshall spill and $650,000 for cleanup costs from the Romeoville spill, and Enbridge reportedly incurred costs in excess of $1 billion for required cleanup activities relating to the Marshall and Romeoville spills.

Under the settlement, Enbridge is committing to the following measures, which it estimates will cost at least $110 million:

  • An enhanced pipeline inspection and spill prevention program;
  • Implement enhanced measures to improve leak detection and control room operations;
  • Commit to additional leak detection and spill prevention requirements for a portion of Enbridge's Line 5 that crosses the Straits of Mackinac in Michigan;
  • Create and maintain an integrated database for its Lakehead Pipeline System;
  • Enhance emergency spill response preparedness programmes by conducting four emergency spill response exercises to test and practice Enbridge's response to a major inland oil spill;
  • Improve training and coordination with state and local emergency responders by requiring incident command system training for employees, provide training to local responders, participate in area response planning and organise response exercises; and
  • Hire an independent third party to assist with review of implementation of the requirements in the settlement agreement.

The government's complaint alleges that Enbridge owned or operated a 30-inch pipeline, known as Line 6B, that ruptured on 25 July 2010, discharging oil into the environment. Although the Line 6B rupture triggered numerous alarms in Enbridge's control room, Enbridge failed to recognise a pipeline had ruptured until at least 17 hours later.

In the meantime, Enbridge had restarted Line 6B on two separate occasions on 26 July 2010, pumping additional oil into the ruptured pipeline causing additional discharges of oil into the environment. Ultimately, Line 6B discharged at least 20,082 barrels of crude oil, much of which entered Talmadge Creek and flowed into the Kalamazoo River which flows to Lake Michigan.

Flooding caused by heavy rains pushed the discharged oil over the river's banks into its floodplains, and accelerated its migration over 35 miles downstream before it was contained. Enbridge later replaced Line 6B, which originates in Griffith, Indiana, crosses the lower peninsula of Michigan and ends in Sarnia, Canada, with a new, larger pipeline, also known as Line 6B. The rupture and discharges were caused by stress corrosion cracking on the pipeline, control room misinterpretations and other problems, and pervasive organisation failures at Enbridge, EPA noted.

The complaint also alleges that on 9 September 2010, another Enbridge pipeline, known as Line 6A, discharged at least 6,427 barrels of oil which Romeoville, Ill., much of which flowed through a drainage ditch into a retention pond in Romeoville.

There will be a 30-day public comment period on the consent decree lodged today.