Judge asks for more information in South Portland pipeline lawsuit

Posted May 14, 2017, at 8 a.m.

PORTLAND, Maine — A federal judge has ordered South Portland and the Portland Pipe Line Corp. to provide more information to resolve a series of contested facts in the company’s lawsuit over a city ordinance that effectively prevents it from piping in crude oil from Canada.

Judge John Woodcock Jr.’s order on Thursday temporarily suspends the city’s request that the suit be dismissed and the company’s motion for summary judgment, further delaying a legal case that has stretched over more than two years and has cost South Portland taxpayers more than $1 million in legal fees.

At stake in the case is South Portland’s so-called Clear Skies ordinance. Passed in 2014, the environmental ordinance bans the bulk loading of crude oil into tankers in the city, effectively stopping the pipeline from reversing its south-to-north flow.

The pipeline has long carried oil across New England to refineries in Montreal. But as global oil markets have shifted in recent years the pipeline has gone mostly dry, creating an incentive to try to reverse it to carry oil south.

The company sued South Portland over the ordinance, but whether it is actually ready to reverse the pipeline’s flow is unclear and affects the court’s ability to rule in the case, Woodcock wrote.

The city submitted expert testimony from Sarah Emerson, an energy industry analyst, to argue that there isn’t enough crude oil moving from the western Canadian oil sands to Montreal for a reversal of the pipeline to be economically feasible. Because the pipeline company may not be able to undertake the project it claims the Clear Skies ordinance is blocking, the suit is “unripe” and should be dismissed, the city claims. This claim is technically a jurisdictional issue.

“PPLC has no concrete plan to reverse the flow of oil in its pipeline,” said South Portland City Manager Scott Morelli

A lawyer for the pipeline company declined to comment, but it has argued in court filings that Emerson’s testimony is unreliable because she lacks first-hand knowledge of all the relevant facts. Woodcock wrote that the testimony nonetheless “raises substantial questions about the practical ability of the plaintiffs to move forward with a plan to reverse the flow of their pipelines.”

The company’s suit claims that South Portland’s ordinance is unconstitutional because it interferes with interstate trade, discriminates against Canadian interests and undermines the regulatory power of the federal government.

Because of these “weighty constitutional issues looming in this case, it is imperative for the court to make certain that it has jurisdiction and to weigh and resolve the factual disputes regarding the court’s jurisdiction,” Woodcock wrote.

The judge’s order states that the court will schedule a telephone conference between the parties in the case. Morelli said that he expects the judge will want to hear further testimony on a number of issues related to whether the company is able and ready to reverse the flow of its pipeline.

 

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