Dec. 19, 2018

Contact: Ed Golder (DNR), 517-284-5815

Mackinac Straits Corridor Authority approves agreement to build multi-use tunnel, remove pipelines from bottom of Straits

Snyder signs agreement that will increase stewardship, inspection requirements on Line 5

The Mackinac Straits Corridor Authority (MSCA) today approved an agreement with Enbridge Energy Limited Partnership to build a multi-use utility tunnel beneath the Straits of Mackinac. The tunnel will house a replacement segment for the Line 5 pipeline that sits on the bottom of the Straits and other utilities.

In addition, the authority, which held its inaugural meeting in St. Ignace, approved the transfer of a property right that will allow Enbridge to construct the tunnel in bedrock beneath the Straits.

Also today, Gov. Rick Snyder and leaders of the departments of Natural Resources and Environmental Quality signed a separate agreement with Enbridge. This Third Agreement carries forward provisions of two previous agreements with the company – one in November 2017 and one in October 2018. The Third Agreement requires Enbridge to undertake an enhanced inspection and stewardship regimen. The agreement also includes interpretations of the 1953 easement for the dual pipelines on the bottom of the Straits, as well as ongoing financial assurance requirements for the pipelines.

The approved agreements will soon be posted on the mipetroleumpipelines.com website.

“From the beginning of this four-year process, our fundamental goal has been to protect the Great Lakes against an oil spill through a solution we know will work,” said Snyder.

“Today’s actions will result in the removal of the oil pipeline from the bottom of the Straits of Mackinac, maintain critical infrastructure connections between our peninsulas, provide energy security for residents of the Upper Peninsula and northern Michigan and create good-paying jobs," he said. "Enbridge will pay 100 percent of the costs for design, construction, operation and maintenance of the tunnel, and will shut down the current Line 5 segment in the Straits once the tunnel is complete.”

Public Act 359 required the MSCA to enter into an agreement to build a tunnel, provided the agreement met certain criteria. In keeping with those criteria, the agreement approved by the authority will:

• Include a plan for recruiting, training and using Michigan workers for the tunnel project.
• Allow for multiple utilities to use the tunnel.
• Provide that the tunnel is built to last and will contain potential oil spills in the Straits of Mackinac.
• Limit liability for the state, the authority and members of the authority.
• Require that all necessary government approvals be obtained for the tunnel.
• Prohibit the use of eminent domain to acquire property for the project.
• Ensure the state bears no cost for design, construction, operation and maintenance of the tunnel.
• Ensure that any privately owned portion of the project – including the above-ground entrances and any utility lines within the tunnel – is subject to taxation.
• Reimburse the Mackinac Bridge Authority for any net loss of profit for leasing space for telecommunication lines.

The Tunnel Agreement contains milestones for construction progress as well as financial penalties for Enbridge for missed deadlines, provided delays are within Enbridge’s control. Once the tunnel is complete, ownership will be turned over to the MSCA, which will be able to lease space within the tunnel to additional utilities.

The increased stewardship mandated in the Third Agreement between the state and Enbridge will apply unless there is a delay beyond Enbridge’s control as defined in the agreement. The Third Agreement also requires that as soon as possible upon completion of the tunnel and construction of the Line 5 replacement segment, Enbridge will deactivate the dual pipelines in the Straits.

Previous agreements charge Enbridge with:

• Replacing the portion of Line 5 that lies at the bottom of the St. Clair River near Port Huron with a new pipe in a tunnel beneath the river to protect drinking water supplies for a significant population in southeast Michigan.
• Instituting accelerated risk-reducing measures at 13 priority Line 5 water crossings, in addition to requiring actions at 68 other crossings as identified with state input in a previous Enbridge report.
• Assuring the Straits pipeline is not operating when high waves would severely hamper response to a potential oil spill. Enbridge staff must be present at the Straits to shut down the line within 15 minutes – even if power is lost – when wave heights hit 6.5 feet for at least an hour. The state will provide a new radar system to supply better, real-time wave-height data at the Straits.
• Assuring that at least $1.8 billion in financial assurance be provided by Enbridge to respond to a potential oil spill in the Straits or anywhere along Line 5 in Michigan.
• Paying for cameras to be installed at the Straits to support new regulations from the U.S. Coast Guard prohibiting ships in the area from dropping their anchors – one of the most serious threats to Line 5 and other utility lines on the bottom of the Straits.
• Prohibiting heavy crude oil from running through Line 5 and not increasing the volume or type of petroleum products that move through the line.