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Oil spill pipeline won't reopen this week: Enbridge


Booms are seen floating on the Kalamazoo river, after an oil pipeline, owned by Enbridge Energy Partners, leaked an estimated 820,000 gallons of oil into the Kalamazoo river in Western Michigan near Marshall July 30, 2010. REUTES/Rebecca Cook
Booms are seen floating on the Kalamazoo river, after an oil pipeline, owned by Enbridge Energy Partners, leaked an estimated 820,000 gallons of oil into the Kalamazoo river in Western Michigan near Marshall July 30, 2010. REUTES/Rebecca Cook

By Steve James

NEW YORK (Reuters) - Enbridge Inc's chief executive said on Sunday the company would not restart its ruptured pipeline in Michigan this week as it continues to clean up 800,000 gallons of oil spilled in and around the Kalamazoo River.

Meanwhile, the Environmental Protection Agency (EPA) said there was "significant improvement" at the spill site after almost a week and no signs of new contamination.

Officials also gave an update on the cleanup efforts, saying 39,000 barrels -- about 1.6 million gallons -- containing oil and water have now been recovered.

The U.S. Department of Transportation ordered Calgary, Alberta-based Enbridge last week to complete a number of precautionary steps before restarting the 286-mile pipeline carrying as much as 190,000 barrels per day of oil from northern Indiana to Sarnia, Ontario.

Chief Executive Officer Pat Daniel told a news conference in Michigan the company would give the EPA its updated draft of the plan on Sunday.

Asked when the company might reopen the pipeline, he stressed the decision was in the hands of federal regulators.

"We have no intention to start-up this week," he said in comments monitored in New York via teleconference.

Daniel said last week that making the pipeline ready to resume operation can take only a matter of days. The pipeline is operated by U.S. affiliate Enbridge Energy Partners

Asked by Reuters what the impact of the spill and cleanup would have on Enbridge's quarterly earnings, he said the company had not calculated that figure as it was focused on the cleanup and dealing with the effected community.

Enbridge may face substantial fines from the United States for the spill. Under the Oil Pollution Act, fines of up to $4,300 a barrel ($100 a gallon) could be levied if it's determined the company was grossly negligent, or $1,100 per barrel if was less irresponsible.

Daniel stressed the company's commitment to residents of a region it has operated in for 40 years. "You don't have to sue Enbridge to be reimbursed," he said.

Residents of 14 homes have evacuated voluntarily and about 100 homes near the Kalamazoo River have been told not to drink water from their taps.

Susan Hedman, EPA regional director, told reporters the agency had already approved $5 million in federal funds to cover clean-up costs "and we will seek recovery of every penny from Enbridge."

She said incrementally she was seeking more funds. "Several million would be appropriate," she said.

"I am happy to report significant improvement of the spill site, at the creek and the river. Oil continues to be removed and we have not seen any further contamination."

Mark Durno, Director of Emergency Management for Michigan's Calhoun County, gave the update on the cleanup process.

"It's a question of weeks to get the oil out of the river and it will be months before all the oil is off the banks and flood plain.

"It will take months before it's cleaned up."

(Reporting by Steve James)

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