Enbridge to pay $61 million fine for 2010 oil spills in Michigan, Illinois

Enbridge (TSX, NYSE:ENB), Canada’s largest pipeline company, will have to pay a $61 million fine for a 2010 oil spill that followed a pipeline rupture in southwestern Michigan and which polluted nearly 65 km (40 mile) of the Kalamazoo River.

The penalty is part of a $177 million settlement between the company and US government agencies, which includes Enbridge’s commitment to improve safety across its pipeline operations, a network of 14 pipelines extending more than 3,300 km across seven states.

The fine, the largest ever for a pipeline spill under the Clean Water Act, come on top of other spill-related costs, including $4 million in natural resource damages the company agreed to pay last year.

The penalty is the largest ever for a pipeline spill under the Clean Water Act.

Additionally, the company pledged to replace 300 miles of a pipeline, pay $1 million for a separate 2010 spill in Romeoville, Illinois, and hire an independent auditor to make sure it complies with the deal.

Enbridge has already paid the US government $57.8 million for clean-up costs related to the company’s Marshall spill, and has directly spent over $800 million on its own clean-up.

In May last year, the Alberta-based company reached an agreement with the state of Michigan to pay $75 million over the incident, one of the largest and costliest inland spills in US history.

"This settlement will make the delivery of our nation’s energy resources safer and more environmentally responsible," Assistant Attorney General John C. Cruden said in an e-mail statement. "It requires Enbridge to take robust measures to improve the maintenance and monitoring of its Lakehead pipeline system, protecting lakes, rivers, land and communities across the upper Midwest."

Cynthia Giles, the assistant administrator for EPA’s Office of Enforcement and Compliance Assurance, said the agreement "puts in place advanced leak detection and monitoring requirements to make sure a disaster like this one doesn’t happen again."

The settlement is subject to a 30-day public comment period, after which a judge will decide whether to accept it.