The Biden administration has reportedly urged a U.S. appeals court to tell a lower court to rethink the order that required Enbridge Inc. (NYSE:ENB) to drain portions of an oil pipeline that runs through Native American tribal land in Wisconsin.
In a brief dated April 8, the U.S. Department of Justice (DOJ) told the Chicago-based 7th U.S. Circuit Court of Appeals that forcing Enbridge to drain portions of its Line 5 pipeline can interrupt service in violation of a 1977 treaty between the U.S. and Canada to keep oil flowing, reported Reuters.
The 71-year-old pipeline carries 540,000 barrels of mostly Canadian oil per day from Wisconsin to Ontario and is part of the wider Mainline network, the report reads.
The U.S., which is not a party to the case, reportedly stated that the lower court was right to find Enbridge is trespassing on the tribal land and said the court should reconsider its decision ordering Enbridge to stop operating portions of the pipeline by 2026.
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Canada, which is also not a party to the case, had earlier argued to keep the company’s pipeline open due to the treaty.
Notably, the lawsuit was filed in 2019 against Enbridge by the Native American tribe, the Bad River Band of Lake Superior Chippewa, who said the tribe is “grateful the U.S. agrees Enbridge is operating on tribal land unlawfully,” but is “disappointed that the U.S. has not unequivocally called for an immediate end to Enbridge’s ongoing trespass.”
An Enbridge spokesperson argued that closing the pipeline would not be in the public interest, and they continue to seek a solution that would not disrupt the flow of oil.
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The company has offered the Band $80 million to settle the dispute.
Last year, U.S. District Judge William Conley in Madison ordered Enbridge to pay the tribe nearly $5.2 million for trespassing, plus a portion of its profits.
In its amicus brief, DOJ also said $5.2 million in restitution is too low, given Enbridge’s profits from the pipeline.
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Price Action: ENB shares are up 0.20% at $34.61 premarket on the last check Thursday.
