TSE-ENB : Enbridge agrees settlement over 2010 pipeline spills

Pipeline company Enbridge Inc (TSE-ENB, Mkt cap 48.48B, P/E 29.65, Div/yield 0.53/4.03, EPS 1.77, Shares 929.23M) has entered into a settlement with the U.S. Department of Justice and U.S. Environmental Protection Agency to resolve claims relating to oil spills in Marshall, Michigan, and Romeoville, Illinois, in 2010.

TSE-ENB Enbridge settlement pipeline spills

TSE-ENB : Enbridge agrees settlement over 2010 pipeline spills

Under the terms of the consent decree Enbridge will pay civil penalties totaling $62m for Clean Water Act violations after the discharge of at least 20,082 barrels of oil from its Line 6B pipeline in Marshall in July 2010 and at least 6,427 barrels of oil from the Line 6A pipeline in Romeoville in September 2010.

Additionally, Enbridge has agreed to spend at least $110m on a series of measures to prevent spills and improve operations across nearly 2,000 miles of its pipeline system in the Great Lakes region.

The U.S. Government alleged that, despite numerous alarms in its control room, Enbridge failed to recognize that Line 6B had ruptured for at least 17 hours. Much of the oil that was discharged entered Talmadge Creek and flowed into the Kalamazoo River, which flows to Lake Michigan.

Flooding caused by heavy rains pushed the discharged oil over the river’s banks into its flood plains and accelerated its migration over 35 miles downstream before it was contained.

Enbridge replaced the entire 285-mile length of Line 6B with a new, larger pipeline in 2014.

Commenting after the settlement was announced on Wednesday, Enbridge Energy Partners president Mark Maki said: “From the beginning, we’ve taken responsibility for the Line 6B release. We accept the civil penalties and enhanced safety measures in the decree. The enhanced safety measures included in the decree are consistent with our approach to safety and integrity and our current practices and have largely been implemented over the past six years.”

Al Monaco, president and CEO of Enbridge, added: “The learnings from our experience have made us a better company and the way we think about safety has changed. Over the past six years, we’ve intensified our focus on the safety and integrity of our systems enterprise-wide and we’ve invested significantly in our people, processes, equipment and technology.

“Across Enbridge, our team is galvanized by our number one priority of safety and reliability of our systems and the protection of the public and the environment.”

Enbridge Inc is a Calgary-based energy transportation and distribution company. The Company operates in five segments: Liquids Pipelines; Gas Distribution; Gas Pipelines, Processing and Energy Services; Sponsored Investments, and Corporate. Liquids Pipelines segment owns and operates crude oil and other liquid hydrocarbons pipelines and terminals. Gas Distribution consists of the Company’s natural gas utility operations. Gas Pipelines, Processing and Energy Services segment consists of investments in natural gas pipelines, gathering and processing facilities and the Company’s energy services businesses, along with renewable energy and transmission facilities. Sponsored Investments includes the Company’s 33.7% economic interest in Enbridge Energy Partners, L.P. (EEP), and Enbridge’s interests in both the Eastern Access and Lakehead System Mainline expansion projects held through Enbridge Energy, Limited Partnership (EELP). The Corporate segment includes an investment in Noverco Inc. More from Reuters »

What is Successful Investing? Learn more here>>

Download Our Free Special Report – How to Hunt For Value Stocks. Michael Sprung will share with you 5 stocks set for long-term gains here>>

We believe that investment management is about managing risk, not chasing speculative returns. Like to learn more? Please contact us here>>

The opinions expressed here are ours alone. They are provided for information purposes only and are not tailored to the needs of any particular individual or company, are not an endorsement, recommendation, or sponsorship of any entity or security, and do not constitute investment advice. We strongly recommend that you seek advice from a qualified investment advisor before making any investment decision.


Comments are closed.