Don't shut Line 5: Biden administration issues long-awaited position on Canada-U.S. pipeline

The Biden administration has weighed in for the first time on a major cross-border legal dispute that could shut down portions of Enbridge's Line 5 Canada-U.S. oil pipeline.

The opinion came in an amicus brief that, although nuanced, argued against shutting down the pipeline, partly in order to preserve diplomatic relations with Canada.

The more than 1,000-kilometre long Line 5 carries 540,000 barrels of oil and natural gas liquids daily across Wisconsin and Michigan to refineries in Sarnia, Ont.

The legal dispute in question is one to which the U.S. government is not actually a party. It involves Calgary-based Enbridge Inc. and the Wisconsin-based Bad River Band of Lake Superior Chippewa, through whose territory the pipeline runs.

In 2023, the U.S. District Court for the Western District of Wisconsin ruled in favour of the Bad River Band and ordered Enbridge to shut down parts of the pipeline within three years and pay the band $5.2 million for trespassing on its land after easement rights expired.

Both Enbridge and the band, which had wanted an immediate shutdown, appealed the ruling.

The Canadian government, in its own brief last fall, argued that a shutdown of the line would violate a 1977 Canada-U.S. pipeline agreement in which the countries agreed not to block the flow of each other's hydrocarbons.

Wednesday's submission from the U.S. Department of Justice cited Ottawa's argument and urged the U.S. Court of Appeals for the 7th Circuit to send the ruling back to the lower court.

On the one hand, Wednesday's brief supported the financial penalty the lower court issued against Enbridge; in fact, it said the payment to the community should be increased.

On the other hand, it urged the appeals court to reverse the part of the ruling that would require a shutdown of several kilometres of the pipeline.

The reason? According to the U.S. Department of Justice, the lower court failed to take into account significant consequences, including the possibility of a costly dispute with Canada.

"The United States has a manifest interest in complying with its treaty obligations with all sovereigns," said the 70-page amicus brief, publicly released Wednesday.

"The district court … did not consider what it had described as the 'significant public policy implications' that a shutdown order would have on the United States's trade and diplomatic relationship with and treaty obligations to Canada."

Canada has for years pressed the Biden administration to weigh in on the pipeline dispute especially in light of the fact that it was that same administration that has already cancelled one Canada-U.S. pipeline project, Keystone XL, on its first day in office in 2021.