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As a health history disclosure authorization form is projected on a screen, James Lee, a resident of Marshall, Michigan, reacts as he testifies during a hearing before the House Transportation and Infrastructure Committee September 15, 2010 on Capitol Hill in Washington, DC. (Alex Wong/Alex Wong/2010 Getty Images)
As a health history disclosure authorization form is projected on a screen, James Lee, a resident of Marshall, Michigan, reacts as he testifies during a hearing before the House Transportation and Infrastructure Committee September 15, 2010 on Capitol Hill in Washington, DC. (Alex Wong/Alex Wong/2010 Getty Images)

Enbridge faces heat for pipeline spills Add to ...

The Obama administration is moving to tighten its scrutiny of oil pipelines after U.S. lawmakers revealed that Enbridge had years of warning about hundreds of potential problems on the line that ruptured in Michigan in July.

Under proposed new rules submitted to Congress on Wednesday, U.S. authorities would increase the maximum fine for pipeline violations causing death to $2.5-million (U.S.) - more than double the current level - and add 40 inspectors and enforcement positions, a nearly one-third increase from current levels.

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Although looming midterm elections make it unlikely that it will soon become law, the proposal comes as lawmakers directed strident new attention toward Enbridge, which is currently facing two downed pipelines and questions about the reliability of its decades-old network.

The company will, however, soon resume shipments on one of those lines. Enbridge has reached an agreement with regulators that will allow it to resume oil flow through Line 6A on Friday, little more than a week after that line was closed down for a spill in Illinois.

Progress on that line came as Enbridge chief executive officer Patrick Daniel was called Wednesday before the congressional subcommittee on Railroads, Pipelines, and Hazardous Materials to defend the company's record on its worst-ever spill, an earlier July leak in Michigan.

Congressional representatives focused on why the leak happened - and why it took so long for Enbridge to respond.

A briefing document released Wednesday shows that after being warned of a potential problem, Enbridge workers restarted oil flow twice over a span of 12 hours. It took the company nearly 16 hours to send an employee to look for a leak, which was eventually discovered by a local gas utility.

The document also shows the company was warned of hundreds of defects in Line 6B, which was built in 1969.

"I have no confidence that Enbridge can operate this pipeline safely, certainly not until all of those defects are taken care of," said Rep. Mark Schauer, a Democrat who represents the Michigan area where that line leaked 19,500 barrels into an important river system.

Mr. Daniel said the company has worked to fix problems on its pipe, but declined to provide any detail on why the leak happened, nor why it took so long to detect the spill.

"Believe me, we want to know more than anyone, and are conducting our own internal investigation as well," he said.

Those questions also remain unanswered by U.S. regulators, who continue their own inquiries. But Deborah Hersman, who chairs the U.S. National Transportation Safety Board, revealed that investigators examining the ruptured section have found evidence of "corrosion on the pipe," which was coated in polyethylene, a product that has not been used to safeguard pipelines against external corrosion for three decades.

Corrosion does not appear to be the cause of a second major leak on Enbridge's Line 6A, which spilled 6,100 barrels in a Romeoville, Ill., industrial park, and which now appears nearly ready to resume operations. The company has completed repairs of the burst line earlier this week.

The Congressional hearing made clear, however, that the company faces more substantial problems with the Michigan Line 6B rupture.

According to the briefing document, Enbridge received warnings of 140 corrosion defects on the line in June, 2008. It was ordered to repair them all within 180 days. It fixed 26 and determined that it might be cheaper to replace parts of the line than to repair some of the remaining problems.

A further test in 2009 found 250 defects. Enbridge fixed 35.

The 329 unresolved defects were not addressed. Instead, Enbridge was allowed to continue operating, provided it trimmed the amount of oil it was putting through the line. Less than two weeks before the Michigan line burst, the company filed a request to continue operating in that way for a further 2½ years.

Company tests had found evidence of potential problems at the location of the eventual leak near Battle Creek, Mich. But Enbridge believed the problem was so small that it was not required to fix it.

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