PHMSA Proposes $3.7 million fine for Enbridge Spill in Michigan in 2010

August 2012, Vol. 67 No. 8

The July 10, 2012, preliminary report from the National Transportation Safety Board (NTSB) on the major oil leak from an Enbridge pipeline in Michigan in July 2010 faults the company's operational and training procedures in numerous instances.

But those findings are to some extent diluted by criticism of unclear federal pipeline safety rules, and the Pipeline and Hazardous Materials Safety Administration (PHMSA) failure to enforce them.

The NTSB report, which will be issued in final form publicly sometime in the future, with additions and deletions from the preliminary report, came about one week after the PHMSA issued a Notice of Probable Violation with the largest proposed civil penalty in its history -- $3.7 million -- as a result of a spill of over 840,000 gallons of crude oil into hundreds of acres of Michigan wetlands, fouling a creek and a river.

"This investigation identified a complete breakdown of safety at Enbridge. Their employees performed like Keystone Kops and failed to recognize their pipeline had ruptured and continued to pump crude into the environment," said NTSB Chairman Deborah A.P. Hersman. "Despite multiple alarms and a loss of pressure in the pipeline, for more than 17 hours and through three shifts they failed to follow their own shutdown procedures."

The NTSB preliminary report appears to be a bit hazy on one issue: whether Enbridge violated federal hazardous liquid integrity management rules with regard to fixing pipeline defects and doing risk assessments with regard to what is called Line 6B. But the company clearly seems to have fallen short of compliance with regard to federal rules in the areas of operation and management procedures, reporting and operator qualification requirements. Perhaps the biggest problem with the Enbridge control room was that they were apparently asleep at the wheel. The rupture occurred during the last stages of a planned shutdown and was not discovered or addressed for over 17 hours. During the time lapse, Enbridge twice pumped additional oil (81 percent of the total release) into Line 6B during two startups.

The NTSB's key finding was that the Line 6B segment ruptured under normal operating pressure due to corrosion fatigue. But the report goes on to say that federal law "does not provide clear requirements regarding when to repair and when to remediate pipeline defects and inadequately defines the requirements for assessing the effect on pipeline integrity when either crack defects or cracks and corrosion are simultaneously present in the pipeline."