Frustrated Canada presses White House to keep Great Lakes oil pipeline
open
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[April 26, 2021] By
David Ljunggren, Nia Williams and Laura Sanicola
OTTAWA/NEW YORK (Reuters) - Canada is
pushing on several diplomatic fronts against the U.S. state of
Michigan's efforts to close a cross-border oil pipeline, the second such
dispute since Joe Biden became U.S. president in January, complicating
the governments' efforts to work together to lower carbon emissions.
The conflict over the aging but key pipeline highlights the disruptions
caused by a global shift away from fossil fuels. Both governments are
working to accelerate the energy transition, but their oil industries
are interdependent, so a policy shift in one country can affect energy
supply, and the political balance, in the other.
The United States imports more crude from Canada than any other nation,
at about 3.7 million barrels per day, or about 80%of Canada's crude
output.
Ottawa's strategy, according to four sources familiar with the
government's thinking, is to repeatedly raise the issue of Enbridge
Inc's Line 5 with numerous U.S. counterparts - including Biden - to get
them to pressure Michigan's Democratic Governor Gretchen Whitmer to keep
the pipeline open.
Last November, Michigan ordered Line 5 to shut by May 13, citing the
environmental risk of a possible leak in the four-mile (6-km) stretch of
the 540,000-bpd line passing under the Straits of Mackinac in the Great
Lakes.
The White House has shown no sign of responding to Canadian entreaties,
so Ottawa is considering more drastic options, including a threat to
invoke an obscure bilateral treaty to keep Line 5 operating or intervene
in the legal dispute currently playing out in U.S. courts.
Line 5, which flows crude oil and refined products from Wisconsin to
Sarnia, Ontario, via Michigan, has been in operation for nearly 70
years, but officials in Michigan are increasingly alarmed by its
advanced age.
The line has never leaked into the straits but there have been at least
eight other spills since 1980, according to U.S. Pipeline and Hazardous
Materials Safety Administration data.
The imbroglio over Line 5 comes just three months after Biden angered
the Canadian oil and gas industry by cancelling a permit for the
long-delayed Keystone XL pipeline project on his first day in office.
Canadian Prime Minister Justin Trudeau's government reluctantly accepted
that decision, even though it killed thousands of construction jobs and
further soured Ottawa's relationship with the main energy-producing
province of Alberta.
Ottawa has resolved to fight publicly to keep Line 5 open, which -
unlike Keystone - is already operating and a vital link in Enbridge's
export network that ships the vast majority of crude from Canada's
western oil patch to the United States.
DOZENS OF MEETINGS
Canadian government officials are frustrated by how much time they are
spending on the matter, the sources said.
Canada has discussed the pipeline's fate in dozens of bilateral
meetings, including 23 virtual meetings between lawmakers and U.S.
members of Congress, according to a spokesman for Canada's Natural
Resources Minister Seamus O'Regan.
"Clearly Line 5 is an important issue for the government of Canada ...
at the same time we need to be advancing on a cooperative basis the work
we're doing on climate action," Canada Environment Minister Jonathan
Wilkinson told Reuters earlier this month.
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Signs of Canadian Prime Minister Justin Trudeau and U.S. President
Joe Biden are by a demonstrator during a climate change protest near
the White House, a day ahead of the virtual global climate summit,
in Washington,U.S., April 21, 2021. REUTERS/Kevin Lamarque/File
Photo
Wilkinson raised the pipeline on Feb. 24 during a meeting with U.S. climate
envoy John Kerry. Trudeau also raised Line 5 with Biden when the two met in
February to discuss making global warming a joint priority. The Canadian prime
minister attended a U.S. international climate summit hosted by Biden last week.
Neither Kerry nor the White House responded to a request for comment.
Calgary-based Enbridge has refused to shut the pipeline, arguing the governor's
order needs to be backed by a judge. The case is being heard in U.S. federal
court and the two parties started mediation on April 16.
Enbridge spokesman Ryan Duffy said a negotiated solution would be in the best
interests of all parties.
Trudeau's administration is mulling whether to take part in the legal challenge
by filing an amicus, or "friend of the court" brief, which would explicitly lay
out their reasons for backing Enbridge, said a source directly familiar with the
matter.
Ottawa is also considering invoking the never-before-used 1977 Transit Pipelines
Treaty, designed to stop U.S. or Canadian public officials from impeding the
flow of oil in transit.
"The federal government continues to have a role to play, and we appreciate what
they've done to date," Enbridge's Duffy said.
SPINAL CORD
Line 5 is key to fuel supply for the Great Lakes region on both sides of the
border, helping supply an area with a population of more than 40 million people.
Environmental campaigners have long been concerned Line 5 could leak into the
straits. Whitmer, a Biden ally, made shutting it a key promise in her 2018
gubernatorial campaign.
Wilkinson, after meeting with Kerry, told reporters that "the issue in Michigan
is the governor."
Canada's Ambassador Kirsten Hillman and Infrastructure Minister Catherine
McKenna have both met separately with Whitmer, but she has not changed her
stance.
A spokeswoman for Whitmer told Reuters that the governor stands behind her
decision to close the pipeline.
Enbridge said shutting Line 5 would cause fuel shortages and gas price spikes,
and require 15,000 trucks and 800 rail cars a day to replace deliveries to
Ontario. Michigan would also need truck transport to account for lost propane
delivery, while refineries in Ohio and Michigan would need to secure supply from
other suppliers.
Scott Archer, business agent with Local 663 Pipefitters Union in Sarnia, home to
three of Ontario's refineries, described Line 5 as the "spinal cord of Ontario's
infrastructure" in testimony to Canadian lawmakers.
"Shutting down Line 5 will in effect kill my hometown... and many more places
like it in Canada and the U.S.," he said.
(Reporting by Nia Williams in Calgary, David Ljunggren in Ottawa and Laura
Sanicola in New York; additional reporting by Valerie Volcovici in Washington;
Editing by Marguerita Choy)
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