July 25, 2019 / 2:09 PM / 23 days ago

UPDATE 2-Enbridge says open to Line 5 re-route after legal action by Wisconsin tribe

(New throughout, adds comment from Suncor Energy CEO)

By Arpan Varghese and Nia Williams

July 25 (Reuters) - Canadian pipeline company Enbridge Inc said on Thursday it will consider re-routing its Line 5 oil pipeline after a Native American tribe in Wisconsin sued the company in a bid to get the pipeline moved off its reservation.

The Bad River Band filed a federal lawsuit against Enbridge on Tuesday in the Western District of Wisconsin, asking for a section of Line 5 that runs across its reservation to be decommissioned and removed because of the risk of a leak.

The 540,000 barrels-per-day pipeline ferries crude and propane from Alberta to refineries in the Midwest and Ontario. It is a critical part of Enbridge’s Mainline network, which delivers the bulk of Canadian oil exports to the United States.

In the lawsuit the Bad River Band said pipeline easements, which are land use agreements between Enbridge and the tribe, for Line 5 had expired and as such the pipeline was trespassing.

Enbridge said the vast majority of easements are valid until 2043 and those in question affect only a “small fraction” of the 12 miles of Line 5 within the reservation.

“Enbridge has considered re-routing Line 5, and as discussed with the Bad River Band, remains open to this option as a solution,” Enbridge said in a statement.

Line 5 also faces a court battle in Michigan, where the state filed a lawsuit last month asking for the decommissioning of an underwater section of the pipeline that runs beneath the Straits of Mackinac in the Great Lakes.

One of Canada’s largest oil and gas producer Suncor Energy , which owns an 85,000 barrel per day refinery in Sarnia, Ontario, said it thought the probability of Line 5 getting shut in is “very low” but was nevertheless focused on the risk.

“We are spending time looking through and trying to understand how we would manage that and we think there are ways we could mitigate the risk associated with it,” Suncor Chief Executive Officer Mark Little told investors on a second-quarter earnings call on Thursday. (Reporting by Arpan Varghese in Bengaluru and Nia Williams in Calgary Editing by Bill Trott, Nick Zieminski and David Gregorio)

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