With a key meeting scheduled for Tuesday, no deal is pending between Dane County and Enbridge Energy Inc. to provide insurance to cover any spill from an underground pipeline already carrying a half-million barrels of tar sands crude daily through Wisconsin.
Moreover, Enbridge maintains it has never agreed to provide additional insurance to local communities and says requiring it would violate federal law. The firm says it already carries a general $700 million insurance policy.
Enbridge, the top exporter of heavy crude oil from western Canada, is seeking a conditional use permit from Dane County to build a new pumping station near Marshall.
The new pumps will help the company triple capacity of its existing 42-inch wide line running from Superior to the Illinois border — potentially carrying more oil than the proposed Keystone Pipeline that has generated far more attention.
But while 11 new pumping stations along the Wisconsin route have been approved by various units of government, a permit from Dane County remains unsettled. The county zoning committee has already postponed voting on the Enbridge permit several times.
There was a report this weekend that Enbridge was considering offering insurance to Dane County but the chairman of the zoning panel says that is not entirely accurate.
“I know they are anxious to move this along but as far as I am concerned nothing is on the table,” says Supervisor Patrick Miles of McFarland.
Enbridge officials met with county lawyers last week on possible solutions to the stalemate but Miles said that was the extent of the conversation.
“We may know more after Tuesday,” he said.
Enbridge’s “Line 61” has been operating without incident since opening in 2009, carrying up to 400,000 barrels of oil per day to refineries in the Chicago area. Enbridge is now looking to expand that capacity to 1.2 million barrels and has already boosted it past 550,000 barrels as new pumping stations have come on line.
Since the pipeline is only expanding capacity, no additional state permits are required. Enbridge says the line was designed to handle 1.2 million barrels when construction was approved by the Department of Natural Resources in 2006.
But Enbridge has come under increased scrutiny because of a 2010 spill that polluted a 35-mile stretch of the Kalamazoo River in Michigan. With cleanup costs at $800 million, it’s considered the most expensive oil pipeline failure in U.S. history with crude continuing to leak for 17 hours after monitors went off.
Another smaller Enbridge “Line 14” sprung a leak in Wisconsin’s Adams County in 2012, sending what one observer called a “gusher” of oil into the air before it was shut off. That spill was estimated at 1,200 barrels or 50,000 gallons even after flow was quickly stopped.
Those incidents — combined with broader concerns about global warming and fossil fuel consumption — have brought calls from environmentalists and some Dane County Board members to make a stand against the Calgary-based firm, which posted $446 million in earnings in 2013.
But whether local governments can require extra regulation of pipeline companies remains open to interpretation. Safe operation of pipelines falls to the Pipeline and Hazardous Materials Safety Administration, part of the federal Department of Transportation.
In Washington state, a handful of local governments have secured additional accident insurance from pipeline owners. In 2011, the city of Kirkland passed an ordinance requiring the partly Enbridge-owned Olympic line to purchase $100 million in general liability insurance and $50 million for pollution liability.
Enbridge officials have denied agreeing to any insurance deal in Washington, saying it was the pipeline operators, not the owners, who made that concession.
“We have never done one before,” said Enbridge spokeswoman Becky Haase when asked about insurance deals with local units of government.
But Samya Lutz of the Pipeline Trust says “the question is not so much whether they (or their subsidiary) have or have not done so: it’s whether local governments have the authority to require it.”
The trust was formed as a public interest watchdog group out of a settlement following a 1999 gasoline pipeline explosion that killed three boys in Bellingham, Washington.
Miles and others have expressed concerns about getting sued by Enbridge if a permit is denied or approved with strict conditions — although an opinion from assistant county attorney David Gault says there are legal grounds for including a financial responsibility clause.
During an interview this weekend on Milwaukee television, Enbridge executive Mark Maki says that moving oil by pipeline is the safest and most efficient means of transport and says the firm has made strides since the 2010 disaster in Michigan.
But Don Ferber of the Madison chapter of the Sierra Club says words alone are not enough.
"If they are looking to expand this pipeline, what we would like to at least do is see full assurances that any environmental damages caused by this pipeline (are) fully mitigated — taken care of,” Ferber told WTMJ.
If the county zoning committee approves the conditional use permit for the pumping station, no other review would be needed.