Thursday, August 19, 2010

Enbridge sees Michigan oil spill exposure at $51.4 million or below

CALGARY, Alta. – Enbridge Energy Partners LP says it might have to pay as much as $400 million in costs related to its pipeline rupture and dilbit (diluted bitumen) spill near Marshall, Mich.
The estimated costs cover the emergency response, pipeline fixes and environmental remediation, the company said, but not any fines associated with the spill.
However, Enbridge Partners disclosed on Aug. 17 that its costs would be only $35 to $45 million after its insurance claims are paid.
Parent Enbridge Inc., which owns 27 percent of Enbridge Energy Partners, said it expects its share of the costs of the pipeline rupture and oil spill to be only about $6.4 million after insurance claims are paid. The figures were released on Aug. 18 by Gina Jordan, an Enbridge Inc. spokeswoman in Calgary.
That would put the combined exposure of Enbridge Partners and Enbridge Inc. in the neighborhood of $41.4 to $51.4 million.
Enbridge Partners was still waiting on Aug. 19 for U.S. regulators to respond to its reworked plan to restart Line 6B, which has been repaired, Jordan said.
Neither the Enbridge Inc. nor Enbridge Energy Partners LP estimates of exposure include possible civil or criminal fines which are usually excluded from insurance coverage. Under the U.S. Clean Water Act, if negligence is proved, Enbridge could be fined up to $4,300 per barrel spilled. Given the 19,500 barrels estimated to have been spilled in the incident, that alone could add up to an additional $83.9 million.

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