A shutdown could have 'domino effects' on thousands of jobs in the oil industry
Author of the article: Naimul Karim
Publishing date:Aug 29, 2022 •
Equipment along the Enbridge Inc.'s Line 5 pipeline route in Sarnia, Ont.
PHOTO BY COLE BURSTON/BLOOMBERG FILES
Canada has invoked a 45-year-old treaty for the second time to trigger direct negotiations with U.S. President Joe Biden’s administration to ensure that oil flows into southern Ontario through Enbridge Inc.’s Line 5 pipeline.
The federal government formally invoked the 1977 Transit Pipelines Treaty to begin a dispute settlement process that will set up direct communication with Washington over the pipeline that carries light crude oil and natural gas liquids from Alberta to Ontario through the United States.
In October, the government turned to the treaty when Michigan tried to shut the line down over concerns about a potential spill. On Monday, the treaty was invoked in response to “serious concerns regarding the possible shutting down” of the pipeline on the Bad River Band tribe’s reservation in northern Wisconsin.
“The economic and energy disruption and damage to Canada and the U.S. from a Line 5 shutdown would be widespread and significant,” Foreign Affairs Minister Mélanie Joly said in a statement. “At a time when global inflation is making it hard on families to make ends meet, these are unacceptable outcomes.”
Joly added that a shutdown could have “domino effects” on the jobs of thousands of Canadians in the oil industry and other connected sectors and communities on both sides of the border.
Canada and the U.S. has held two meetings since it invoked the treaty for the first time in October, a foreign affairs spokesperson said. Prior to turning to the treaty for the second time, the two countries met thrice “informally” to address concerns around Line 5 in Wisconsin.
Calgary-based Enbridge Inc., which owns Line 5 and is North America’s largest pipeline company, has been fighting Michigan in a legal battle over the pipeline. In July, the state’s regulators ordered the company to file additional information on the safety of its proposed Line 5 oil pipeline tunnel which it plans to build to rehouse its existing 540,000 barrel per day pipeline.
The company also has a proposal to relocate the segment of the Line 5 outside and around the Big River Band Reservation, which Joly said Canada “strongly supports.”
Canada has invoked a 45-year-old treaty for the second time to trigger direct negotiations with U.S. President Joe Biden’s administration to ensure that oil flows into southern Ontario through Enbridge Inc.’s Line 5 pipeline.
The federal government formally invoked the 1977 Transit Pipelines Treaty to begin a dispute settlement process that will set up direct communication with Washington over the pipeline that carries light crude oil and natural gas liquids from Alberta to Ontario through the United States.
In October, the government turned to the treaty when Michigan tried to shut the line down over concerns about a potential spill. On Monday, the treaty was invoked in response to “serious concerns regarding the possible shutting down” of the pipeline on the Bad River Band tribe’s reservation in northern Wisconsin.
“The economic and energy disruption and damage to Canada and the U.S. from a Line 5 shutdown would be widespread and significant,” Foreign Affairs Minister Mélanie Joly said in a statement. “At a time when global inflation is making it hard on families to make ends meet, these are unacceptable outcomes.”
Joly added that a shutdown could have “domino effects” on the jobs of thousands of Canadians in the oil industry and other connected sectors and communities on both sides of the border.
Canada and the U.S. has held two meetings since it invoked the treaty for the first time in October, a foreign affairs spokesperson said. Prior to turning to the treaty for the second time, the two countries met thrice “informally” to address concerns around Line 5 in Wisconsin.
Calgary-based Enbridge Inc., which owns Line 5 and is North America’s largest pipeline company, has been fighting Michigan in a legal battle over the pipeline. In July, the state’s regulators ordered the company to file additional information on the safety of its proposed Line 5 oil pipeline tunnel which it plans to build to rehouse its existing 540,000 barrel per day pipeline.
The company also has a proposal to relocate the segment of the Line 5 outside and around the Big River Band Reservation, which Joly said Canada “strongly supports.”
“Canada respects the rights and interests of Indigenous peoples, such as the Bad River Band’s governance of their territory as a U.S. Tribe,” Joly said. “In the forthcoming negotiations with the United States under the treaty, Canada is committed to working constructively to find a solution that responds to the interests of communities.”
In a statement, Enbridge said it appreciated the Canadian government’s efforts to keep the line operating.
“Enbridge remains open to resolving this matter amicably with the Bad River Band… the company is actively pursuing permits for a 41-mile re-route of Line 5 around the Reservation,” Enbridge said, adding that pipelines continue to be a safer and more reliable way to transport fuel than a truck, train or barge since the other modes burn more fuel, releasing more greenhouse gases.
The 1977 treaty was initially pushed by the U.S. government at a time when oil producers were interested in building a pipeline from Alaska through Canada to the lower 48 states.
It states that “no public authority in either party shall institute any measures … which are intended to, or which would have the effect of, impeding, diverting, redirecting or interfering with in any way the transmission of hydrocarbon in transit.”
In a statement, Enbridge said it appreciated the Canadian government’s efforts to keep the line operating.
“Enbridge remains open to resolving this matter amicably with the Bad River Band… the company is actively pursuing permits for a 41-mile re-route of Line 5 around the Reservation,” Enbridge said, adding that pipelines continue to be a safer and more reliable way to transport fuel than a truck, train or barge since the other modes burn more fuel, releasing more greenhouse gases.
The 1977 treaty was initially pushed by the U.S. government at a time when oil producers were interested in building a pipeline from Alaska through Canada to the lower 48 states.
It states that “no public authority in either party shall institute any measures … which are intended to, or which would have the effect of, impeding, diverting, redirecting or interfering with in any way the transmission of hydrocarbon in transit.”
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