As both Canada and the U.S. await the heavily anticipated court decision of the Line 5 pipeline, people are holding their breath and hopeful for good news.
Michigan and its Governor Gretchen Whitmer has ordered Canadian-owned Enbridge to close its 67-year-old pipeline over concerns about its environmental safety, which delivers a massive amount of oil and energy requirements (540,000 barrels a day) to Ontario, Quebec, and midwestern states, as well as more than half the propane consumed in Michigan.
Concerns about the pipeline’s aging condition and potential environmental dangers are years in the making. Late in 2020, Whitmer brought a salvo to the dispute, giving Enbridge until May 12, 2021 to cease operations of the pipeline, with Enbridge not complying. The two sides are to meet again in mid-May.
While Whitmer and the state are ordering the pipeline to close, business leaders in Michigan, Ohio, and Wisconsin are urging the court to keep Line 5 in operation. In the article, Christopher Guith, senior vice president, policy, at the U.S. Chamber of Commerce’s Global Energy Institute said, “unfortunately, millions of Americans and Canadians are likely to pay the price [of this political theatre].”
After seeing events unfold at gas stations in the U.S. after the Colonial pipeline hack, shutting down Line 5 could have massive negative ramifications from an economic standpoint – higher prices, lost jobs, as well as a disruption of daily lives of individuals and companies.
Recently former Saskatchewan premier Brad Wall says he finds it upsetting that it took a potential shutdown for the federal government to finally take a stance and defend Canadian oil. Speaking to CJME in Saskatchewan, Wall said, “It took the threat of the shutdown significantly impacting our central Canadian fellow citizens to get the federal government to find interest in pipelines,” he said.
“Maybe even the spectre of a shutdown will help convince voters in central Canada to demand something different from federal parties in terms of their energy policy.
“Any protracted shutdown is not good for the industry and the timing is not great.”
Another factor and wild card in this holding pattern and dispute is the 1977 Transit Pipeline Treaty which prohibits either side from blocking the shipment of oil and gas through a pipeline such as Line 5 between the two countries. If need be, this treaty and trump card can be invoked if deemed necessary.
The treaty, a last resort, has not been formally invoked.
Joe Comartin, Consul General of Canada in Detroit said in the National Post valves are unlikely to be shut off, as it would require a confirmatory order by a federal or state-level judge.
The decision is of real concern and impact to many across both countries. Al Monaco, Enbridge CEO has said bad things will happen if the pipeline is shut down, and that 540,000 barrels per day can’t just be taken out of the market and no ramifications to be felt.
With both sides digging their heels in – Enbridge saying they will not close the line short of a court order, and Whitmer calling the pipeline a “ticking time bomb” – it’s hard to see how this decision shakes out.