Canada turns to 1977 treaty with US for second time in Battle of Line 5

Shutdown could have ‘domino effects’ on thousands of oil industry jobs

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Canada has invoked a 45-year-old treaty for the second time to trigger direct negotiations with US President Joe Biden’s administration to ensure oil flows into southern Ontario through the Line 5 pipeline. ‘Enbridge Inc.

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The federal government has formally invoked the 1977 Transit Pipeline Treaty to begin a dispute resolution process that will establish direct communication with Washington over the pipeline that carries light crude oil and natural gas liquids from Alberta to Ontario through the United States.

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In October, the government turned to the treaty when Michigan tried to close the line due to concerns about a potential spill. On Monday, the treaty was invoked in response to “serious concerns about the possible closure” of the pipeline on the Bad River Band Tribal Reservation in northern Wisconsin.

“The economic and energy disruption and damage to Canada and the United States from the closure of Line 5 would be widespread and significant,” Foreign Affairs Minister Mélanie Joly said in a statement. “At a time when global inflation is preventing families from making ends meet, these are unacceptable results.”

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Joly added that a shutdown could have “domino effects” on the jobs of thousands of Canadians in the oil industry and other related sectors and communities on both sides of the border.

Calgary-based Enbridge Inc., owner of Line 5 and North America’s largest pipeline company, has been battling Michigan in a legal battle over the pipeline. In July, state regulators ordered the company to file additional information about the safety of its proposed Line 5 pipeline tunnel it plans to build to relocate its existing 540,000-barrel pipeline through day.

The company also has a proposal to move the Line 5 segment out and around the Big River Band reservation, which Joly said Canada “strongly supports.”

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“Canada respects the rights and interests of Indigenous peoples, such as the Bad River Band’s governance of their territory as an American tribe,” Joly said. “In the upcoming negotiations with the United States under the treaty, Canada is committed to working constructively to find a solution that meets the interests of the communities.

In a statement, Enbridge said it appreciated the Canadian government’s efforts to keep the line in service.

“Enbridge remains open to resolving this matter amicably with the Bad River Band…the company is actively seeking permits for a 41-mile rerouting 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 other modes consume more fuel and release more greenhouse gases.

The 1977 treaty was initially pushed by the US government at a time when oil producers were interested in building an oil pipeline from Alaska through Canada to the lower 48 states.

It states that “no public authority of either party shall institute measures…which are intended to, or which would have the effect of, hindering, misappropriating, redirecting or otherwise interfering whether with the transmission of hydrocarbons in transit”.

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