Polaris in the News: Articles on Enbridge's Michigan Oil Spill

Polaris quoted in the Globe and Mail, Edmonton Journal and Winnipeg Free Press (also in this other WFP article)

All articles talk about the Enbridge Michigan spill and implications on Enbridge and its other projects such as the Northern Gateway project to the coast of BC.

(see below in that order)

Links to more articles where Polaris is quoted:

Battle Creek Enquirer
The Tyee
Brandon Sun

Français:

Radio-Canada
Radio-Canada Radio

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Spill halted, Enbridge’s reputation sullied: Canadian company allowed pipes to corrode; Kalamazoo River leak could cost $40-million to clean up

David Ebner and Cigdem Iltan

Vancouver and Battle Creek, Mich. — From Friday's Globe and Mail Published on Thursday, Jul. 29, 2010 3:02PM EDT Last updated on Friday, Jul. 30, 2010 7:45AM EDT

The Enbridge spill into Michigan’s Kalamazoo River has been contained, but it’s left a nasty sheen on the company’s reputation and its sprawling network of aging pipelines in North America.

This week’s spill of about 20,000 barrels of oil came after a “warning letter” from a United States government official in January that said Enbridge wasn’t doing enough to mitigate corrosion on the pipeline that burst Monday, and had likely violated federal regulations.

In Battle Creek, home to 53,000 people, residents feared the damage had already been done, despite increased effort to contain and clean up the oil. Some had to leave their homes as the noxious smell polluted the air and oil lapped the river’s shore.

“We’ve already been devastated in Battle Creek,” said vice-mayor Chris Simmons. “The oil’s here and it’s had a tremendous impact on our river, the environment and the community.”

Out by the river, a sign from the local county public health department warned that swimming, boating and fishing were prohibited because of the spill.

Several families who were evacuated from homes along the shoreline have been put up at a hotel in downtown Battle Creek. Displaced people continued to trickle in on Thursday night, staff at the McCamly Plaza Hotel said, but they were being turned away because the hotel was full.

Renee Carpentier and her family wearily packed their belongings back into their white minivan at the McCamly Plaza Hotel in Battle Creek Thursday night. They were evacuated from their home on the river shore in Marshall earlier this week, and then forced to move again to another hotel that had room for them.

"We're exhausted," Ms. Carpentier said as her husband lifted a room fan onto the backseat.

Resident Steven Schwartz stood on a bridge, clapping his hands to scare birds away from the water. “I'll be here all night,” he said tearfully.

Enbridge’s spill is far smaller than the millions of barrels that poured into the Gulf of Mexico after a disastrous blowout on a BP oil rig, but financial analyst Bob Hastings of investment bank Canaccord Genuity said the incident has “badly tarnished” the Calgary company’s reputation.

The spill is the latest in a series of similar missteps over the past decade for Enbridge, North America’s largest oil pipeline operator with more than 13,000 kilometres in the ground. The pipelines can carry 2.6-million barrels a day – mainly along an Alberta-Chicago route – and much of them are decades old, like the 41-year-old line that burst in Michigan.

The Polaris Institute of Ottawa tallied about 600 Enbridge leaks in the decade to 2008, at an average of roughly 200 barrels. The last largest spill comparable to the one in Michigan happened at a hub near Edmonton in 2001, where most of the oil was eventually recovered.

The Michigan spill also pokes a hole in arguments put forward by Canada’s oil sands industry in recent months – that its production methods, including delivery via pipelines, are environmentally safer than offshore drilling.

Responding on Thursday to questions of safety in the U.S. regulator’s warning letter, Enbridge insisted it has been in close contact with government officials throughout the year and had dug up ground in 139 locations to investigate potential problems on Line 6B, the pipeline that failed.

The spill location, in a marshy area at an Enbridge pump station southeast of Battle Creek, was not flagged by earlier tests as a place for worry, the company said. Enbridge had started this year implementing new technology to monitor corrosion.

Pat Daniel, chief executive officer of Enbridge, apologized to Michigan residents for “the mess we have made.”

As the spectre of BP’s multibillion-dollar bill in the Gulf loomed over Enbridge, the company was pressed about the cost of cleanup and its ability to pay. It didn’t provide a figure but said it could well afford it. As of the end of June, it had $409-million in cash on hand.

The spill could cost Enbridge a total of $40-million, Mr. Hastings, the financial analyst estimated.

“We will spend whatever it takes to clean it up,” a sombre Mr. Daniel said at a press conference on Thursday afternoon in Battle Creek.

Of the 20,000 barrels spilled in the pipeline rupture, about half had been pulled from the water as of Thursday afternoon, according to U.S. officials, who warned much more work remained.

“We expect this will go on for a while, certainly a number of weeks, if not a couple of months before all the oil can be cleaned up,” said Ralph Dollhopf, the federal on-scene co-ordinator for the U.S. Environmental Protection Agency.

Oil poured out of a pipe on a small tributary of the Kalamazoo River and some of it travelled about 40 kilometres downstream, past Battle Creek, before it was stopped at the head of a local lake. The spill was halted quickly and the oil that travelled the farthest was still about 80 kilometres upstream from Lake Michigan, which U.S. officials said was safe.

A first hint of the cause of the spill emerged on Thursday. Line 6B was shut down as part of regular business operations for 10 hours overnight Sunday and it appears the burst pipe is linked with the restart on Monday morning. As of late Thursday, the broken portion of pipe was still in the swampy ground, as Enbridge worked to expose it to sever and extract the section, which will be inspected by U.S. officials.

Mr. Hastings said the spill could “galvanize” opposition to the company’s controversial proposal to build a new pipeline called Northern Gateway from Alberta through northern British Columbia to export oil sands production.

A group of Battle Creek residents have set up a tent in a church parking lot in nearby Marshall, where they are collecting donations such as towels for wildlife cleanup efforts, said volunteer co-ordinator Matt Davis.

“We're just doing it. No one from the government or Enbridge asked us to do this,” Mr. Davis said. “It's a real hardship for everyone.”

The phone at the Circle D Wildlife rescue agency has been ringing steadily the past couple of days with reports of animals covered in oil, agency staff member Jeff DeCuypere said.

Most of the animals in distress are found on the river's shore, he said.

“We've been busy responding to calls all day,” he said.

Enbridge’s initial response to the spill has been lambasted as “anemic” by Michigan Governor Jennifer Granholm. On Thursday, Enbridge said it had 450 people working on the spill, up from 250 on Wednesday.

The broken Line 6B carries 190,000 barrels a day of oil from the Chicago area through Michigan to refineries in Sarnia, Ont. It’s not known how long the pipeline will be closed.

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Spill intensifies Canadian pipeline fears

Northern Gateway hearings will focus on Enbridge's record

By Hanneke Brooymans, edmontonjournal.com July 30, 2010 6:58 AM Comments (3)

EDMONTON — The disastrous spill from an Enbridge pipeline in Michigan will make the upcoming pre-hearing sessions on the company's Northern Gateway project more intense, environmentalists say.

Aboriginal and environmental groups have been speaking out against the project for months, saying it poses an unacceptable risk to the environment and their livelihoods.

The spill in Michigan unleashed more than over three million litres of oil into a tributary of the Kalamazoo River. The oil made its way into the river and there are fears it could find its way into Lake Michigan.

Enbridge's Northern Gateway pipeline would extend 1,172 kilometres from Bruderheim, just north of Edmonton, to Kitimat on the B.C. coast. It would carry an average of 525,000 barrels of petroleum -- anything from crude to refinery products -- per day. The joint review panel established to evaluate the project is holding pre-hearings beginning in Whitecourt on Aug. 10, then travelling to Kitimat and Prince George later in August and September.

The pre-hearings will help the panel decide on the scope and location of the actual hearings, and whether or not Enbridge needs to file more information before the hearings begin.

Activists responded almost immediately to the Michigan incident. Four Greenpeace members entered an Enbridge office in Vancouver on Wednesday and locked themselves in. With tar balls they said were collected from the Gulf of Mexico, they wrote "B. C. next?" on the glass office doors. They were arrested at 1:30 a.m., spent the night in jail, and were charged with mischief.

"I definitely think the (Michigan) spill reinforces a lack of trust and also the incredible risk this pipeline poses to British Columbia in particular," said Nikki Skuce, senior energy campaigner for ForestEthics, a lobby group.

Skuce said the Northern Gateway pipeline is supposed to cross 1,000 streams and rivers, including the Skeena and Fraser rivers, which are valuable wild salmon habitat and important to cultures and regional economies in B.C.

She said the Michigan spill and Enbridge's lack of adequate reaction are telling.

The company has promised that it will have the best technology for Northern Gateway and that it would be able to tell within five minutes if there was a leak and shut it off, she said. "This latest spill just shows you. How can we trust them?"

There is some controversy about when the Michigan spill from the pipeline, called Line 6B, started. Residents in the area reported hydrocarbon odours Sunday. But the company says the leak started Monday.

Skuce said residents along the Northern Gateway route will want even more emphasis in the hearings on the actual response rates, the company's spill record and worst-case scenarios.

Enbridge spokesman Alan Roth said it's been proven and statistics show that pipelines are the safest way to transport oil and gas.

"Sometimes we go four years without hearing anything at all about pipelines, but as it turned out there's coincidence of timing with some of these most recent events," he said.

The company's goal is to have no releases, but it acknowledges that the size and complexity of its pipelines systems create a big challenge in reaching that objective. The company's latest annual report showed it had 93 reportable spills, leaks and releases in 2008.

A Polaris Institute report on Enbridge from earlier this year said the company had 610 incidents, spilling 21 million litres of hydrocarbons into the environment between 1999 and 2008. "This amounts to approximately half of the oil that spilled from the oil tanker the Exxon Valdez after it struck a rock in Prince William Sound, Alaska in 1988," they wrote.

A major issue for pipeline companies is corrosion. Enbridge's Line 6B was built in 1969. A Jan. 21, 2010, letter from a U.S. regulator, the Pipeline and Hazardous Materials Safety Administration, indicated the company was not following the rules when it came to monitoring corrosion on this line. The company had discontinued use of five monitors in 2006 and 2007 due to "communication/ instrumentation problems." The alternative method of monitoring they wanted to use was supposed to be implemented in the first half of 2010, but its interim measures did not satisfy the administration. It's not clear if the new system was implemented.

In a conference call Thursday, Steve Wuori, Enbridge executive vice-president for liquids operations, said the company completed 139 maintenance digs on the line between Griffith, Ind. and Sarnia, Ont. in the last year, in conjunction with its work with the regulator. No digs or replacements were scheduled for the area where the spill originated because there was nothing in the inspection data to signal it could be a problem area.

Enbridge president and CEO Patrick Daniel said the company will go back and re-examine the data in conjunction with the consultants who prepare the inspection reports to see if there's anything in the data associated with this specific section of pipe that is showing up in its other pipelines.

Daniel also apologized again to the people of Calhoun County for the mess the company made to their properties and the river.

"We take full responsibility for the cleanup and we will be here until you are happy in this community and in this county that we've completed our responsibilities," he said.

Daniel said the company has collected most of the oil on the river, but acknowledged it still has a lot of work to do.

Karen Campbell, staff counsel for the Pembina Institute, said it's inevitable that pipelines will corrode, leak and fail. Enbridge has, on average, 67 pipeline leaks a year and this is unfortunately one of the things that will become a reality if the Enbridge Gateway pipeline goes ahead, she said.

"And that I do think is relevant and hopefully will feed into the review process when it happens."

hbrooymans@thejournal.canwest.com
© Copyright (c) The Edmonton Journal

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Expected cost, size and clean-up time of Enbridge spill dwarfed by BP disaster

By: Lauren Krugel, The Canadian Press

30/07/2010 2:30 PM

CALGARY - When an Enbridge pipeline leaked millions of litres of crude into a Michigan waterway this week, it didn't take long for critics to draw comparisons to BP's gargantuan oil spill in the Gulf of Mexico.

But the BP disaster dwarfs the Enbridge spill by numerous metrics, including size, cost and how long it took to stop the flow.

The pipeline on Enbridge's Lakehead system dumped as many as 3.8 million litres of crude into a tributary of the Kalamazoo river in Michigan. By contrast, the estimates of the Gulf spill range from 355 million litres to 700 million litres.

And while the cost of the BP crisis is expected to run into the tens of billions, the financial impact from Enbridge's spill will likely be "negligible," said Canaccord Genuity analyst Bob Hastings.

"I'd have to work hard to get it to a dime a share," he said. "At the end of the day it's just not going to be a material item."

But there's no denying Enbridge's image has been marred, Hastings added.

"Even if it wasn't their fault and even if they reacted impeccably... it will tarnish their reputation."

BP's stock market value has been decimated since the Deepwater Horizon rig exploded in April, killing 11 workers. On the other hand, the stock market reaction to the Enbridge spill has been much more blase, seeing a drop of about three per cent between Monday and Friday.

In the Gulf, it took months for BP to install a cap over the blown out well more than a kilometre under the sea. And that's only a temporary measure.

Enbridge was able to shut off the flow through the pipeline in very short order and on Friday said the spill had been contained. Fears that the crude will find its way along the Kalamazoo River into Lake Michigan were dissipating.

"Their response has been pretty much exemplary," said Richard Martin with Alcera Consulting, which advises companies on how to manage risk.

Enbridge's top brass travelled to Michigan straight away and have been briefing the press regularly. Clean up crews were dispatched quickly.

By Friday, more than 380,000 litres had been collected, and nearly 1.6 million litres were in a holding area waiting to be pumped into tanks.

"They've committed to cleaning it up and paying what needs to be paid," Martin said.

While the Enbridge and BP incidents differ in many respects, the two share underlying causes that can't be ignored, Richard Girard with the Polaris Institute said earlier this week.

"I think people are starting to realize that oil comes at a major environmental price," he said.

"Our reliance on fossil fuels has facilitated the rapid expansion of the huge pipeline infrastructure that we have across the continent... We should be shifting away from that and towards a more sustainable and greener society that doesn't rely so much on fossil fuels."

Opponents to a proposed Enbridge pipeline that would connect oilsands crude to the West Coast have used the latest spill to underline their argument that the Northern Gateway pipeline should not be built.

"Enbridge is poised to become the BP of B.C.," Greenpeace campaigner Stephanie Goodwin said Wednesday, as activists with the environmental group occupied an Enbridge officer in downtown Vancouver.

Martin said it's old, corroded pipelines — the one that leaked in Michigan built in 1969 — that pose a problem.

"The real issue here is the need to renew the system of pipelines and make sure that they're as modern as possible and that they're well maintained," he said.

"I would much rather have brand new lines in than old lines that are 40 years old that need to be continually patched and have Band-Aids put on them."