VIEW OF THE Straits of Mackinac and Mackinac Bridge from near Enbridge’s pumping station in Mackinaw City. (Laina G. Stebbins/Michigan Advance)

A report has found that a shutdown of Enbridge Inc.’s Line 5 pipeline would be both commercially and operationally feasible and proposes a number of alternatives for transporting crude oil and natural gas liquids.

PLG Consulting, which advises a variety of industries — including oil and gas — on logistics and supply chain solutions, published the report in October. While PLG notes it has no position on the merits of a shutdown, its report found there are a range of replacements for the pipeline that are both commercially and operationally feasible.

Line 5 has been at the center of legal turmoil for years, with tribal nations and environmental activists calling on Canada-based Enbridge to shut down Line 5 that runs from northwestern Wisconsin, through the Upper Peninsula and under the Straits of Mackinac to Sarnia, Ontario. In June a federal judge in Wisconsin ordered Enbridge to shut down and move part of the pipeline by June 16, 2026, as part of a suit filed by the Bad River Band of Lake Superior Chippewa.

Michigan Attorney General Dana Nessel has also been involved in a suit to decommission the pipeline, suing Enbridge in 2019. The U.S. Sixth Circuit Court is set to weigh arguments on whether the case belongs in state or federal court, after a motion from Enbridge to move the case to federal court.

Given the recent developments in the Line 5 case, PLG performed its analysis to determine what would happen in the case of a Line 5 shutdown and how the market could adapt to deliver energy supplies reliably and cost effectively.

Line 5 transports up to 540,000 barrels per day of crude oil and natural gas liquids, according to Enbridge.

While the pipeline supplies 65% of the propane demand in the Upper Peninsula and 55% of the state’s propane, PLG found that in the event of a shutdown, energy markets would be able to adapt, and given advance notice, the markets would be able to do so without price spikes or shortages.

“The companies participating in Line 5 products and markets are sophisticated and large energy firms that regularly evaluate and anticipate risks and market changes. Therefore, it’s not surprising that for at least the past six years, contingency plans have been developed by key refiners and other businesses whose supply chains may be altered in the event of a Line 5 shutdown,” the report reads.

By breaking down characteristics of the North American energy industry, and Line 5’s products and market, the report found there are a variety of commercially and operationally viable supply chain alternatives to Line 5.

In its key findings, the report notes that no refinery relies entirely on Line 5 for its crude oil supply, that all of the identified alternatives already deliver crude oil and natural gas liquids within the Line 5 region, and that contingency plans for a shutdown have been in development since 2017, and can be deployed quickly.

PLG offered two types of solutions in its report: Phase I solutions that can be implemented within three months with little to no investment, and phase II solutions that will take 12 to 18 months to implement and/or nominal capital investment.

In addressing alternatives for transporting crude oil, PLG suggested increased shipments to Montreal and Quebec City from watercraft, full utilization of Enbridge’s Line 78 — which only operates at 78% capacity — and utilizing crude oil deliveries by rail for refineries with the capacity of to receive them.

These solutions would account for all but 13% of Line 5’s supply of crude oil, which could be accounted for with refined products, the report said.

For phase II solutions, enhanced crude oil by rail capabilities could be installed in Toledo, Ohio, and Sarnia.

Additionally, decarbonization and the growth of the electric vehicle industry in the U.S. and Canada have reduced demand for gasoline and will continue to reduce the use of fossil fuels, the report said.

In offering alternatives for natural gas liquid transportation, PLG analyzed two different markets: propane distribution to northern Wisconsin, the Upper Peninsula and northern Lower Peninsula; and the industrial and residential distribution in the greater Sarnia, Port Huron area, where propane is stored in preparation for peak wintertime heating season.

In addressing Wisconsin, the Upper Peninsula and northern Lower Peninsula, PLG proposed full utilization of existing rail terminals and the Ambassador pipeline distribution hub in Kalkaska, Mich., as phase I solutions. For phase II an additional rail terminal would need to be built or existing terminals would need to be expanded, with the report noting six candidate locations have been identified for additional terminals in the Upper Peninsula.

When addressing phase I solutions for greater Sarnia and Port Huron, PLG proposed the delivery of propane via rail to all five storage locations in the area, mainly during the summer. It also suggested direct shipment from natural gas liquid production areas to Line 5 propane markets.

In its proposed phase II solution, PLG proposed shipping purity propane or mixed natural gas liquids with propane via already existing pipelines currently connecting the Marcellus/Utica shale play to the Sarnia/Port Huron/Windsor storage caverns.

Nessel praised the report, calling it a “game changer.”

“Enbridge has tried to justify its operation of a dangerous pipeline in the Great Lakes by arguing that Line 5 is too important to the economy to shut down. Those claims have never been true – Enbridge is concerned with its own profits, not Michigan’s economy. As this new report shows, Michigan does not need Line 5,” Nessel said in a statement.

In an amicus brief submitted in support of the Bad River Band of the Lake Superior Tribe of Chippewa, Nessel said the state has taken extensive steps in recent years to ensure the state is prepared to maintain energy security in a pipeline shutdown. This includes the MI Propane Security Plan, a five-step plan to ensure a secure propane supply in the state following the shutdown of Line 5.

However, Ryan Duffy, a spokesperson for Enbridge said its Great Lakes tunnel project is already the agreed upon solution to protect the Great Lakes from a potential spill.

Last month, all 18 of Michigan’s Republican senators criticized delays in the permitting process for the tunnel, which would encase Line 5 in the Straits of Mackinac. As the U.S. Army Corps. of Engineers prepares a National Environmental Policy Act Environmental Impact Statement on the project, the earliest construction could begin is 2026.

In an email to the Advance, Duffy said the report’s recommendations “defy common sense” and that placing additional oil tankers on the Great Lakes and rail cars across the region would put the environment at risk.

Duffy also supported an “all of the above” approach to energy, saying all forms will be needed to meet increasing energy demand.

Additionally, Enbridge’s mainline system is near capacity and is regularly apportioned or oversubscribed, Duffy said.

“The best long-term plan to maintain the energy needs of this region is the Great Lakes Tunnel Project, which Enbridge is continuing to advance. It is the safer, smarter, better solution to protecting the environment and protecting our economies,” Duffy said.

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