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Judge grants motion by state of Michigan to appeal key decision in Line 5 dispute

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By James McCarten in Washington

The U.S. judge presiding over Michigan’s bid to shut down the Line 5 pipeline has given her blessing to the state to appeal one of her key findings, breathing new life into a strategy that hinges on getting the dispute heard by a lower court.

Back in August, District Court Judge Janet Neff rejected a motion from Michigan Attorney General Dana Nessel to send the case back to state court, where Nessel has acknowledged they have a better chance of winning.

But earlier this week, Neff granted Nessel’s request to certify that August decision, clearing the way for what’s known as an interlocutory appeal — formally asking an appeals court to reverse a judge’s order before a final decision in the case has been made.

Such certifications, rare in U.S. law, must meet certain conditions, Neff wrote in a decision Tuesday: that they involve a “controlling question of law” that’s likely to generate a difference of opinion, and that an appeal could expedite a resolution.

“Having reviewed the record, the court concludes that this dispute is one of the exceptional situations that compels certification,” the order reads.

“Each of the three issues identified by (the) plaintiff involve a controlling question of law, there is substantial ground for difference of opinion, and an immediate appeal will materially advance the ultimate termination of the litigation.”

Neff has also ordered that the current case — just one of several open files involving Enbridge Inc., Line 5 and the state of Michigan — remain stayed and administratively closed until the appeal is resolved.

Michigan has been in court for years with Calgary-based Enbridge in an effort to shut down Line 5, fearing a disaster in the Straits of Mackinac, the ecologically sensitive region where the pipeline crosses the Great Lakes.

Enbridge and its allies, which include the federal Liberal government in Ottawa, insist the pipeline is safe, that planned upgrades will make it even safer, and that a shutdown would impart too great a cost for the North American economy to bear.

The legal saga, however, has been dominated almost from the start by arcane procedural questions about jurisdiction and precedent, with Tuesday’s decision likely to deepen that morass even more.

Nessel has made three central arguments: that Enbridge flouted a 30-day window to move the case to district court; that Neff relied too heavily on her own earlier decision to reject Nessel’s motion in a separate but nearly identical Line 5 case; and that the question of jurisdiction has not been properly settled.

“The attorney general believes that the federal trial court clearly erred when it refused to send the case back to state court,” Nessel’s office said in a statement. “The order allows (Nessel) to ask the federal court of appeals to step in and right this wrong.”

Environmental groups in Michigan that back the state’s efforts against Line 5 also cheered the decision.

“This ruling is good news for the Great Lakes. Enbridge’s use of the federal courts to delay the state’s ability to protect the Great Lakes is unconscionable,” National Wildlife Federation counsel Andy Buchsbaum said in a statement.

“We hope that this will get the case back on track quickly so the Great Lakes doesn’t suffer from a massive oil spill.”

Enbridge, for its part, sees things differently.

A statement from the company cited Neff’s own words from the August 2022 decision in which she accused Nessel of seeking “a race to judgment and a collision course between the state and federal forum.”

“The attorney general seeks to undermine these considerations and promote gamesmanship and forum shopping,” Enbridge said, “while ignoring the substantial federal issues that are properly decided in federal court and not state court.”

This report by The Canadian Press was first published Feb. 23, 2023.

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Alberta

‘Existing oil sands projects deliver some of the lowest-breakeven oil in North America’

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From the Canadian Energy Centre 

By Will Gibson

Alberta oil sands projects poised to grow on lower costs, strong reserves

As geopolitical uncertainty ripples through global energy markets, a new report says Alberta’s oil sands sector is positioned to grow thanks to its lower costs.

Enverus Intelligence Research’s annual Oil Sands Play Fundamentals forecasts producers will boost output by 400,000 barrels per day (bbls/d) by the end of this decade through expansions of current operations.

“Existing oil sands projects deliver some of the lowest-breakeven oil in North America at WTI prices lower than $50 U.S. dollars,” said Trevor Rix, a director with the Calgary-based research firm, a subsidiary of Enverus which is headquartered in Texas with operations in Europe and Asia.

Alberta’s oil sands currently produce about 3.4 million bbls/d. Individual companies have disclosed combined proven reserves of about 30 billion barrels, or more than 20 years of current production.

A recent sector-wide reserves analysis by McDaniel & Associates found the oil sands holds about 167 billion barrels of reserves, compared to about 20 billion barrels in Texas.

While trade tensions and sustained oil price declines may marginally slow oil sands growth in the short term, most projects have already had significant capital invested and can withstand some volatility.

Cenovus Energy’s Christina Lake oil sands project. Photo courtesy Cenovus Energy

“While it takes a large amount of out-of-pocket capital to start an oil sands operation, they are very cost effective after that initial investment,” said veteran S&P Global analyst Kevin Birn.

“Optimization,” where companies tweak existing operations for more efficient output, has dominated oil sands growth for the past eight years, he said. These efforts have also resulted in lower cost structures.

“That’s largely shielded the oil sands from some of the inflationary costs we’ve seen in other upstream production,” Birn said.

Added pipeline capacity through expansion of the Trans Mountain system and Enbridge’s Mainline have added an incentive to expand production, Rix said.

The increased production will also spur growth in regions of western Canada, including the Montney and Duvernay, which Enverus analysts previously highlighted as increasingly crucial to meet rising worldwide energy demand.

“Increased oil sands production will see demand increase for condensate, which is used as diluent to ship bitumen by pipeline, which has positive implications for growth in drilling in liquids-rich regions such as the Montney and Duvernay,” Rix said.

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Alberta

It’s On! Alberta Challenging Liberals Unconstitutional and Destructive Net-Zero Legislation

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“If Ottawa had it’s way Albertans would be left to freeze in the dark”

The ineffective federal net-zero electricity regulations will not reduce emissions or benefit Albertans but will increase costs and lead to supply shortages.

The risk of power outages during a hot summer or the depths of harsh winter cold snaps, are not unrealistic outcomes if these regulations are implemented. According to the Alberta Electric System Operator’s analysis, the regulations in question would make Alberta’s electricity system more than 100 times less reliable than the province’s supply adequacy standard. Albertans expect their electricity to remain affordable and reliable, but implementation of these regulations could increase costs by a staggering 35 per cent.

Canada’s constitution is clear. Provinces have exclusive jurisdiction over the development, conservation and management of sites and facilities in the province for the generation and production of electrical energy. That is why Alberta’s government is referring the constitutionality of the federal government’s recent net-zero electricity regulations to the Court of Appeal of Alberta.

“The federal government refused to work collaboratively or listen to Canadians while developing these regulations. The results are ineffective, unachievable and irresponsible, and place Albertans’ livelihoods – and more importantly, lives – at significant risk. Our government will not accept unconstitutional net-zero regulations that leave Albertans vulnerable to blackouts in the middle of summer and winter when they need electricity the most.”

Danielle Smith, Premier

“The introduction of the Clean Electricity Regulations in Alberta by the federal government is another example of dangerous federal overreach. These regulations will create unpredictable power outages in the months when Albertans need reliable energy the most. They will also cause power prices to soar in Alberta, which will hit our vulnerable the hardest.”

Mickey Amery, Minister of Justice and Attorney General

Finalized in December 2024, the federal electricity regulations impose strict carbon limits on fossil fuel power, in an attempt to force a net-zero grid, an unachievable target given current technology and infrastructure. The reliance on unproven technologies makes it almost impossible to operate natural gas plants without costly upgrades, threatening investment, grid reliability, and Alberta’s energy security.

“Ottawa’s electricity regulations will leave Albertans in the dark. They aren’t about reducing emissions – they are unconstitutional, ideological activist policies based on standards that can’t be met and technology that doesn’t exist. It will drive away investment and punish businesses, provinces and families for using natural gas for reliable, dispatchable power. We will not put families at risk from safety and affordability impacts – rationing power during the coldest days of the year – and we will continue to stand up for Albertans.”

Rebecca Schulz, Minister of Environment and Protected Areas

“Albertans depend on electricity to provide for their families, power their businesses and pursue their dreams. The federal government’s Clean Electricity Regulations threaten both the affordability and reliability of our power grid, and we will not stand by as these regulations put the well-being of Albertans at risk.”

Nathan Neudorf, Minister of Affordability and Utilities

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