Overview of Marshall Spill
On July 26, 2010, a crude oil spill on Line 6B of the Enbridge Energy Partners (EEP) Lakehead system was reported near Marshall, Michigan. Enbridge estimates that 20,000 barrels of crude oil were leaked at the site and that, of that amount, about 8,000 barrels reached the Talmadge Creek, a tributary of the Kalamazoo River.
The released crude oil affected about 61 kilometres (38 miles) of area along the Talmadge Creek and Kalamazoo River waterways between Marshall and downstream of Battle Creek, Michigan.
A multi-agency effort led by the U.S. Environmental Protection Agency (EPA), the Michigan Department of Natural Resources and Environment (MDNRE), and other federal, state and local agencies guided the cleanup and remediation efforts. By spring 2011, 18,245 barrels of the oil had been recovered and re-injected into Enbridge’s terminal in Griffith, Indiana.
Enbridge completed the removal and replacement of the pipeline segment that failed under the supervision of the United States Department of Transportation’s Pipeline and Hazardous Materials Safety Administration.
Prior to the leak, Enbridge had been transporting about 190,000 barrels of crude oil per day on Line 6B. Enbridge completed the removal and replacement of the pipeline segment that failed under the supervision of the United States Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA), which required us to perform specific tasks to ensure the safety of the pipeline before returning it to service. We completed these steps, and safely returned the pipeline to service on September 27, 2010.
As part of the Corrective Action Order on Line 6B, PHMSA directed Enbridge to replace a section of the pipeline located beneath the St. Clair River, which forms the border between Michigan and Ontario. A dent in that section had been confirmed during a 2009 in-line inspection. The dent had most likely been present since the pipe’s installation in the late 1960s, however, following the Marshall leak, public tolerance for any risk on Enbridge’s system was understandably low and scrutiny of Enbridge by elected and regulatory officials was high. Therefore, with operational excellence in mind, Enbridge completed the repair in June 2011, well before the September 2011 PHMSA deadline.
During the second quarter of 2012, cleanup of the areas affected by the Line 6B release had been substantially completed, which allowed the Kalamazoo River and Morrow Lake to be re-opened for recreational use. Enbridge will also continue to perform necessary remediation, restoration and monitoring of the areas affected by the Line 6B crude oil release.
Enbridge initially estimated $430 million of aggregate gross costs resulting from our response efforts, before insurance recoveries, fines and penalties, and about $13 million of lost revenue. Those costs included the emergency response, environmental remediation and cleanup activities associated with the crude oil release and potential claims by third parties.
We revised our estimate to $550 million based on a review of costs and commitments incurred, as well as additional information concerning the requirements for environmental restoration and remediation. That number represented the gross estimate before insurance recoveries. Enbridge had expected to pay about 90 per cent of the estimated costs by the end of 2011.
However, on July 2, 2012, Enbridge received a Notice of Probable Violation (NOPV) from PHMSA related to the Line 6B crude oil release, which indicated a US$3.7 million civil penalty. Enbridge agreed to pay the penalty and included that amount in the total estimated cost for the Line 6B crude oil release. As a result of this fine and some additional work that was required, Enbridge, as of June 30, 2012, revised the total estimate for costs to US$785 million ($131 million after-tax attributable to Enbridge) for this incident, before insurance recoveries, and excluding fines and penalties which may be imposed by federal, state and local government agencies, other than the PHMSA civil penalty described above.
The expected losses associated with the Line 6B crude oil release include those costs that are considered probable and that could be reasonably estimated at June 30, 2012. Despite the efforts Enbridge has made to ensure the reasonableness of our estimates, there continues to be the potential for us to incur additional costs in connection with the Marshall spill due to variations in any or all of the cost categories, including modified or revised requirements from regulatory agencies, in addition to fines and penalties and expenditures associated with litigation and settlement of claims.
On July 10, 2012, the U.S. National Transportation Safety Board (NTSB) presented the results of its investigation into the Line 6B crude oil release and subsequently posted its final report on July 26, 2012.
Responding to community needs
Taking care of the communities is a vital part of Enbridge’s ongoing response to the leak on its Line 6B in Michigan.
Enbridge opened community centres in Marshall and Battle Creek within days following the incident to provide a way for the public to ask questions about the spill or to submit claims for damages. In general, the claims issues ranged from property impacts to expenses incurred as a direct result of the leak to medical issues.
Enbridge also initiated a home purchase program for people living within 61 metres (200 feet) of Talmadge Creek and the Kalamazoo River. The program was designed to help maintain property values to help minimize any immediate adverse reactions to the housing market because of the spill. By the time the program ended in July 2011, the company had purchased over 150 homes.
A toll-free information hotline was established immediately following the incident. Issues addressed in the calls ranged from questions about air and water quality to reporting locations of oiled wildlife. In conjunction with U.S. Fish and Wildlife, a Wildlife Response Center was established in Marshall and began taking in animals within a few days following the spill. Several types of oiled wildlife, including ducks, geese, beavers and turtles were treated at the centre, and most were released back into their natural habitat.
By spring 2012, cleanup, under the direction of the U.S. Environmental Protection Agency, had progressed to the point that the Kalamazoo River and Morrow Lake had been reopened for recreational use.
Based on input from local residents, community leaders and recreation groups, much of our community efforts have focused on increasing access to the Kalamazoo River.
Enbridge has created or improved five river access sites to encourage recreational opportunities along the Kalamazoo River. Three new locations were dedicated in the fall of 2011. They are called Saylor’s Landing, Angler’s Bend and Paddler’s Grove. In June 2012, Calhoun County reopened Historic Bridge Park to the community where Enbridge added parking, enhanced the playground and picnic area, and added a handicap-accessible boat lift. Enbridge is also establishing a portage route around Ceresco Dam to provide a safe and legal way for people to navigate around the dam.
A high priority for Enbridge is to ensure that local communities along the river support these investments. Enbridge is in the process of engaging regulators, elected officials, public representatives and interested parties regarding Enbridge’s community investment programs to ensure there is broad public participation and support.
In addition, Enbridge has and will continue to support other programs that align with our corporate community investment initiatives to help build sustainable communities. Enbridge has contributed more than $300,000 to organizations in the area, including the Marshall Historical Society; Wilder Creek Conservation Club; United Ways of Battle Creek, Marshall and Kalamazoo; Red Cross of South Central Michigan; Food Bank of South Central Michigan; Michigan Envirothon.
Other ways for Enbridge to support the local communities have emerged as well. Enbridge provided use of our helicopter normally used for daily air operations to local law enforcement in search operations on two occasions: once for a bank robber and another for a woman who had gone missing from an adult foster care home. Local emergency services and personnel from the National Weather Service also used the helicopter following a severe storm that swept through Battle Creek in June 2011 in order to view the damage from the air. Also, Enbridge provided the sonar equipment used in the cleanup efforts for the search and recovery effort when a young man drowned in the Kalamazoo River this spring.
Enbridge employees have also made personal contributions to the Marshall and Battle Creek communities. They contributed more than $3,500 to a United Way campaign and more than $1,400 for the Red Cross following the Battle Creek storms.
Enbridge’s Line 6B spill was unprecedented for our company. We committed since the outset of the incident to restore the area as closely as possible to its pre-existing condition, and to the satisfaction of the U.S. EPA, Michigan Department of Environmental Quality and the local community. We remain fully committed to that goal.
For current information on our response to the Marshall spill, please visit our Line 6B Response website.
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