Opponents of Enbridge’s proposed pipeline across northern Minnesota on Thursday petitioned the state utility regulator to reconsider its approval of the $2.6 billion project, citing the recent collapse of the Canadian oil industry.
The Minnesota Public Utilities Commission reapproved the new Line 3 in February, a do-over vote necessary because an appellate court shot down the PUC’s blessing of the project’s environmental impact statement, or EIS. The PUC later approved a retooled EIS.
Enbridge’s new pipeline would replace its aging Line 3, transporting crude from Alberta to Superior, Wis.
Environmental groups — Friends of the Headwaters, the Sierra Club, Honor the Earth and Youth Climate Intervenors — filed for Line 3 reconsideration, as did the Red Lake and White Earth bands of Ojibwe and the Minnesota Department of Commerce.
The Commerce Department, which also opposed the PUC’s first Line 3 approval in June 2018, said the commission failed to adequately determine the accuracy of Enbridge’s long-term oil demand forecasts.
The environmental groups and tribes made the same claim, but brought in new arguments based on the oil downturn caused in part by the coronavirus pandemic. While the oil industry is enduring trouble around the world, Canada’s relatively high-cost oil sands have been hit particularly hard.
“It is not at all clear that either oil demand or North American oil production will rebound any time soon, or even whether they ever will return to pre-pandemic levels,” Minnesota-based Friends of the Headwaters said in its reconsideration petition. “We are now in a different world.”
Calgary, Alberta-based Enbridge, in a statement, said Thursday’s filings reiterate many of the same issues the PUC has previously rejected, including the idea of an inadequate demand forecast.
Citing a previous PUC order, Enbridge said the PUC “relies on long-range forecasts in its ... analysis because evidence of short-term fluctuations in oil markets are not particularly useful in determining the need for a petroleum pipeline.”
It’s uncommon for the PUC to reverse its decisions after receiving reconsideration petitions. However, the petitions often serve as a precursor to challenging a PUC decision before the Minnesota Court of Appeals.
The new Line 3 proposal has been winding through the state’s regulatory process for five years. It still needs more technical approvals from two state agencies and the U.S. Army Corps of Engineers.
The new pipeline would be one of the largest construction projects in Minnesota in recent years.
Enbridge has said the pipeline is a critical safety enhancement. The current Line 3 is corroding and therefore running at only half capacity. The new pipeline would restore full oil flow.
Environmental groups and some Indian bands have said the pipeline — which follows a new route — would open a new region of pristine waters to the prospect of oil spills, as well as abetting increased greenhouse gas emissions.