Pipeline company agrees to $177M settlement for 2010 oil spill

Enbridge Inc. has agreed to a $177 million settlement with the federal government to resolve charges related to a pair of oil pipeline spills in 2010 in Michigan and Illinois.

The agreement includes a $62 million fine, $5 million to reimburse the federal government’s cleanup costs, and implementation of a program to prevent future spills worth at least $110 million.

{mosads}It’s the second-largest federal fine for an oil spill in the country’s history, behind the $18.7 billion settlement BP reached for the 2010 Deepwater Horizon disaster.

“It is a strong statement of deterrent for others, but it’s also holding them accountable for the actions that they did here on site,” John Cruden, the Justice Department’s top attorney for environment and natural resources cases, said at a news conference on the banks of the Kalamazoo River in Michigan.

In July 2010, Enbridge’s 6B line ruptured at the spot where it crosses a tributary of the Kalamazoo River in Michigan, spilling at least 850,000 gallons of heavy crude oil from Canada into the water. It was the worst onshore oil spill in United States history.

The spill harmed wildlife, plants and ecosystems, and caused much of the river to be closed for years while the Environmental Protection Agency (EPA), Coast Guard and state officials cleaned it up.

The disaster spurred significant new attention toward the safety of oil pipelines and federal opposition to the Keystone XL pipeline, which President Obama rejected last year.

Enbridge took responsibility for the spill. It settled with the state of Michigan for $75 million last year.

“We accept the civil penalties and enhanced safety measures in the decree,” Mark Maki, president of the Enbridge unit that operates the pipeline, said in a statement.

“The enhanced safety measures included in the decree are consistent with our approach to safety and integrity and our current practices and have largely been implemented over the past six years.”

A small portion of the federal settlement is for a spill later in 2010 on an Enbridge line in Illinois.

The National Wildlife Federation blasted the settlement, calling it a slap on the wrist.

“A $62 million penalty and promises to maintain pipelines as a penalty for the worst inland oil disaster in U.S. history is woefully insufficient and shows that Congress and the Obama administration must work together to strengthen penalties,” Collin O’Mara, the group’s president, said in a statement.

The EPA and Justice Department will accept comments from the public for 60 days on the proposed settlement. A federal judge will then decide whether to approve it.