Enbridge takes heat for Michigan spill

Enbridge Inc. was in the hot seat in the U.S. capital on Wednesday, facing accusations at a congressional hearing that it knew about defects in one of its pipelines before a leak spilled almostfour million litres of oil into a rural Michigan river this summer.

"Freeze their assets, shut down the pipeline until it's brought up to date," Michelle BarlondSmith, a resident of Marshall, Mich., told the House of Representatives transportation and infrastructure committee.

"This company has known about the faults of this pipeline and has done nothing. ... Oil companies must not be allowed to set their own rules and regulations."

BarlondSmith was one of several local residents who testified to the committee, many of them in tears as they recounted a series of stories about the spill in late July. They told of finding oil-soaked muskrats and geese that had to be left to die and having to answer questions from their children about whether they'd get cancer as a result of the leak.

Jim Oberstar, a Minnesota Democrat who is the chairman of the committee, told the hearing that Enbridge knew about hundreds of defects along Line 6B before the leak near Marshall and failed to take the measures required to fix them. The line remains shut down.

"We are pursuing these matters and have done so for more than 25 years," Oberstar told BarlondSmith. "We've not had as much success at moving stronger regulations through Congress and the executive branch as we'd like."

But even as he spoke, the Department of Transportation announced a new Obama administration plan that would tighten federal oversight of the country's aging pipelines and significantly increase penalties for certain violations in response to both the Michigan spill and a gas pipeline explosion last week in California that killed four people.

The plan, sent to Congress on Wednesday, would more than double to $2.5 million USthe maximum fine for the most serious violations involving deaths, injuries or major environmental harm. It also would pay for an additional 40 inspectors and safety regulators over the next four years.

In addition, the bill would eliminate exemptions from safety regulations for pipelines that gather hazardous liquids upstream of transmission pipelines.

Transportation Secretary Ray LaHood said his department "needs stronger authority to ensure the continued safety and reliability of our nation's pipeline network."

Calgary-based Enbridge has joined BP as one of the most distrusted oil companies in the United States as a result of the Michigan spill. Another Enbridge leak insuburban Chicago last week, along with concerns about another possible leak in New York state, raised further concerns about the safety of Enbridge's so-called Lakehead system, which surrounds the Great Lakes.

On the BP front, outgoing CEO Tony Hayward came under scrutiny from British MPs on Wednesday over the Gulf of Mexico oil spill, months after he had little by way of explanation at a memorably tense congressional hearing in Washington.

Mark Schauer, a Democratic congressman on the committee who represents the area affected by the Michigan spill, told the hearing he was stunned to see his community dealing with the same ordeal as residents near the Gulf of Mexico this summer.

"I never would have imagined that just after holding hearings on the BP Deepwater Horizon spill and strengthening the Oil Pollution Act, my community would be dealing with images of oil-coated geese and a river flowing black with oil," he said in his opening remarks.

"I am very concerned before this pipeline is restarted that it can operate safely. Given the recent releases in New York and Illinois, and the over 80 release incidents reported by Enbridge since 2002, I do not think it can."

In prepared testimony, Enbridge CEO Patrick Daniel said his company will take full responsibility for cleaning up the spill and ensuring it doesn't happen again.

"No spill is acceptable," he said. "Since Day 1, we have taken responsibility for cleaning up the spill, addressing the needs of the individuals and businesses in Marshall, Battle Creek and the surrounding area and remediating affected areas."