LCO Tribe Renews Enbridge Pipeline Easement for $70 million Over 25 years
A group of Tribal Members toured Enbridge's Edgewater Pump Station. They include Brian Bisonette, Nita Kemp, Matt Riedell, Brett McConnell, Pat Eaton, Henry Bearheart, Bill Nebel.
The Lac Courte Oreilles Tribal Governing Board passed a resolution at its Tuesday, October 11 council meeting, approving an agreement with Enbridge Energy Partners that would give right-of-way for two existing pipelines that cross 3.5 miles of the southwestern corner of the reservation.
Enbridge has operated a pipeline through the easement since 1968, formerly as Lakehead Pipeline Company, adding a second line in 1998. The 50-year easement for the two pipelines expires in 2018 and under the previous agreement Enbridge never had to make any payments to the tribe.
Under the new 25-year agreement approved by the tribal governing board on Tuesday, Enbridge will make an initial payment of 3.6 million dollars to the tribe followed by another payment of 3.6 million dollars in 2018 and 2019. For the remainder of the term, Enbridge will pay 2.2 million annually adjusted each year by changes in the consumer price index reflecting percentage increases for the remainder of the term, for an estimated total of $70,857,764.
The tribe said in a statement issued today, “From the outset, the negotiating teams were committed to creating a respectful and constructive process for their discussions, a key factor in enabling them to reach a historic and mutually-beneficial agreement. This agreement acknowledges and respects the Band's sovereignty, delivers meaningful community benefits for the duration of the easement and provides annual payments to the Tribal government as the landowner.”
LCO Chairman Louis Taylor said the deal will provide much-needed financial security for the tribe. “This isn’t about today,” Taylor said. “This is about our kids and 25 years from now.”
"These pipelines have been on our land for a long time and we saw a unique opportunity to exercise our sovereignty," Taylor said in the tribal statement. "Refusing to work with Enbridge would have resulted in damage to our lands due to the removal of the pipelines, and we would have received no benefit. Enbridge understood that we have a duty to uphold our values, protect our sovereignty, and better our community. They collaborated with us to find a solution that worked for both parties. Positive history was made and hopefully it's a sign of better relations to come between Native Americans and industry."
Taylor told DrydenWire.com he wants the tribal membership to be involved with how the money will be used.
LCO Secretary-Treasurer Jason Weaver led the team from LCO during their negotiations with Enbridge. He said, “I feel we made a historic deal that will benefit the tribe for generations, most members were for the agreement after we explained that it is only for the existing pipes and not new pipelines. We will exercise our right to tax them and regulate them, and we will continue to work with Enbridge and ensure safe operations. We all use oil to heat our homes, operate our vehicles and live a modern lifestyle.”
The statement issued by the tribe said this is a historic move and in addition to compensating the Tribe for the land rights granted, Enbridge will fund annual community investment initiatives for the term of the easement.
"The payment for the Easement, which will be split into yearly payments over a 25-year period, was calculated by taking many factors into account. First, a portion of the payment is composed of a lump sum that Enbridge typically pays out to individuals who grant them an easement,” the tribe said. “Secondly, a portion of the payment is composed of what a state or other sovereign would be paid in taxes for Enbridge having an easement on state, tribal or federal lands. Finally, the rest of the payment, which composes the vast majority of it, are funds that Enbridge has committed to the tribe, above and beyond the typical lump sum and tax payments made to either an individual or state with a pipeline easement.”
The tribe went on to say this portion of the funds was vigorously negotiated for by the tribe, the investment of these funds will strengthen services and programs in the community, and LCO members will help identify priority projects including, but not limited to renewable energy projects, infrastructure, education, cultural heritage, youth and elder programs .
"Part of the agreement includes ongoing investments in renewable energy at LCO to further LCO's goal of energy independence," said LCO Chairman Louis Taylor.
In a statement to the tribal membership in August, Jason Weaver said, “Any agreement would include a significant and ongoing monetary commitment to our community, future investments in renewable energy, investments in education, elder care and consistent, meaningful community engagement. The tribe would receive an easement payment and annual tax payments, as well as involving our tribal business in construction, maintenance, and upgrade activities along the pipeline routes, which would provide us with much more first-hand oversight on pipeline maintenance activities.”
Weaver also said the tribe would receive project management support and training for the tribe and people interested in learning this much-needed skill set.
“Project management support will focus on upgrades to our wastewater treatment plant and future renewable energy opportunities that will help us reduce our carbon footprint and our dependence on fossil fuels,” Weaver said. He said at that time the tribe was already working with Enbridge on scholarships for LCO College, training in emergency management, and community safety grants for public safety services.
LCO Council member Tweed Shuman confirmed Enbridge would hire and train LCO tribal members to watch the line and the pumping station in case they are ever needed for emergency preparedness or to do an emergency shut off.
Shuman said the agreement does not allow any new pipelines but only covers the existing lines. There are two lines that run through the reservation (6A and 14). Shuman said the agreement is also insured and will continue for the 25 years if the pipes are being used or not.
The two lines are 467 miles long and run from Superior, Wis. to Illinois. Line 6A is 34 inches in diameter and has the capacity to transport 667,000 barrels per day while Line 14 is 24 inches in diameter and can transport 318,000 barrels per day.
If the easement was allowed to expire and the LCO Tribe refused to grant Enbridge the right-of-way through the reservation, the company would have abandoned its operations on the line and built new lines through an existing right-of-way they have two other lines running through skirting along the edge of the southern reservation border.
Another factor tribal council members considered in the negotiation process was the two lines along the border of the reservation are only a few miles south of the lines passing through the reservation and any possible spills in either right-of-ways would contaminate the same water system that flows west to east into the reservation. The same threat would still have existed and the tribe wouldn’t have received any compensation nor had any part in oversight and maintenance of the lines.
LCO Tribal Council member Don Carley said the pipes are already in the ground. “They’ve been there for 50 years and it’s still going to happen and we wouldn’t have any say, and now we do.”
The tribe’s statement added, “In addition to financial benefits and community investment, rigorous emergency management processes, cultural sensitivity, awareness and education programs and responsible environmental stewardship will all be key areas for cooperation and collaboration under this new relationship."
Some key messages included in the statement said LCO citizens will help identify priority projects each year; Enbridge has demonstrated they are committed to a collaborative partnership with LCO, and the community is benefitting from the agreement with meaningful projects.