Shippers complain: Does Enbridge have enough insurance?

On May 9, 2011, Enbridge Pipelines (NW) Inc. discovered an oil release near Willowlake Creek, NWT from its Norman Wells Pipeline.  Between 750 and 1,500 barrels (between 119,243 L and 238,485 L) of oil were released.  Enbridge charged repair and clean up costs arising from the spill to its shippers on the pipeline.  One of the shippers, ISH, contacted Enbridge to enquire why insurance coverage on the pipeline was not used to cover the spill costs.  Enbridge did not provide a response.

ISH has now brought a complaint before the National Energy Board (NEB) asking the NEB to compel Enbridge to explain why the spill costs were not paid by insurance and to determine whether Enbridge failed to comply with certain sections of the NEB Act.  In its books, Enbridge designated most of the spill costs as standard costs of operating the pipeline. 

ISH has noted that, at the time of the Norman Wells clean-up, Enbridge may have already exhausted its insurance coverage in dealing with the Line 6B rupture in Marshall, MI.  ISH says that it is "concerned that ENW's insurance coverage, under the comprehensive insurance coverage, had been exhausted at the time of the Pipeline leak, and that ISH, and the other shippers on the Pipeline, were accordingly denied the benefits of insurance coverage."  ISH raises questions about the cross-subsidization of pipelines and its effect on shippers: "exhaustion of insurance by ENW's affiliated entities should not entitle collection of Spill Costs from its shippers, while such Spill Costs would have otherwise been covered by insurance."

Read the complaint at: Letter from ISH to NEB re Enbridge Pipelines (NW) Inc. 2011 Willowlake Pipeline Spill Operating Costs Complaint.

Enbridge Line 6B Citizens' Blog

Click here to visit a blog by "concerned landowners affected by the Enbridge 'replacement' project": Line6B Citizens' Blog.  Recall that Enbridge's plan for its Line 6B pipeline in Michigan (related to the Kalamazoo River spill) is to abandon about 75 miles of pipe in place and to construct new pipe in a new easement next to it.  The new easement will be obtained by expropriation where agreement is not reached with the landowner.

Turning a blind eye: NEB won't consider NTSB Kalamazoo Rupture findings in deciding on Enbridge Line 9 Reversal Application

The National Energy Board (NEB) has released a decision dismissing a motion by the Ontario Pipeline Landowners Association (OPLA) that requested the re-opening of the evidentiary record of the Enbridge Line 9 Reversal Project hearing process to allow the NEB to consider the report of the NTSB into the Line 6B Rupture in 2010.  Although the NEB was "satsified that the synopsis and full report could contain information that is relevant to the Project", it ruled that:

• it is "mindful that Enbridge and parties, who have fully presented their case, are entitled to a timely decision from the Board";
• the NEB "was fully aware that this NTSB report would be issued.  Still, the Board commenced its proceeding and conducted a public hearing without waiting for this report.";
• although the NEB has yet to release a decision on the Line 9 Reversal, "the Board is satisfied that it has conducted a comprehensive assessment against its own set of regulatory requirements and applicable Canadian standards to determine whether Enbridge has the ability to safely construct and operate the Project.";
• "The Board is of the view that it has all the information it needs to be able to make a final decision on Enbridge's Project."

The NEB's decision begs the question: what harm is there in considering the report of a sister regulator into Enbridge's operational and integrity management systems?  Not only has the NEB declined to postpone its decision on the Line 9 Reversal until it has reviewed the final report of the NTSB, it has declined even to consider the NTSB synopsis that is already available.

Read the decision at: July 20, 2012.