SOUTH PORTLAND, Maine — Can communities say no to energy companies?
Hundreds of miles from the nearest oil field, the answer to this question is playing out here, as a long-running battle over plans to pipe tar sands oil from Canada to Maine for export nears a pivotal moment.
On one side is South Portland, which in 2014 passed the “Clear Skies Ordinance” to outlaw heavy crude exports from its harbor, arguing that a tar sands project would pollute the city’s air.
On the other is the Portland Pipe Line Corp., the company behind the project, and its allies, including the American Petroleum Institute, whose members include most major oil and gas companies. The institute spent hundreds of thousands of dollars to defeat a ballot measure in 2013 that would have blocked the project. The City Council approved the ordinance with an overwhelming majority a year later. Portland Pipe Line is now suing the city, arguing the ban is unconstitutional.
On Tuesday, a federal judge heard arguments from both sides and is expected to rule in the coming weeks on whether the case can proceed. A final decision in favor of the company could unleash the flow of Canadian tar sands oil to one of the East Coast’s largest oil ports.
The city’s four-year fight to fend off the oil industry offers perhaps a cautionary tale. South Portland, with a population of 25,000 and an operating budget of $32.6 million, had spent $1.1 million as of August in legal fees to defend its ban, and the costs continue to rise.
At issue is the right of communities to make their own rules when it comes to oil and gas operations. The legality of local ordinances is open to judges’ interpretations, and litigation almost always follows.
“This has always been seen by the companies as a beachhead,” said Sean Mahoney of the Conservation Law Foundation, who has advised the city. “They can’t allow communities to pass this kind of ordinance because it could be a model for communities everywhere.”
The project would reverse the flow direction on a pipeline system that carries conventional crude oil 236 miles north from a tanker facility in South Portland. The pipelines traverse southern Maine, New Hampshire, and Vermont before connecting with Enbridge’s Line 9 in Montreal. A reversal would bring Alberta’s landlocked tar sands oil to the coast.
The plans call for a pair of smokestacks to burn off volatile organic compounds from the oil before it is loaded into tankers. The project’s opponents saw the potential for air pollution as a clear risk. They drafted the ordinance using Maine’s “home rule authority,” which allows communities to create regulations that go beyond state rules to protect public health and welfare.
Portland Pipe Line — which is owned by Imperial Oil, a subsidiary of ExxonMobil, Shell Canada, McColl-Frontenac, and Suncor Energy — argued in court that the ordinance violates the state and federal constitutions. Citing ongoing litigation, the company declined to comment.
In 2013, the grass-roots group Protect South Portland got wind of the company’s plans and backed a ballot question aimed at blocking the export of tar sands oil.
With funding from the oil industry, the trade group Maine Energy Marketers Association led the opposition. Its supporters knocked on doors, telling residents that the ordinance would shut down the waterfront, an area key to the local economy.
After the ballot measure failed, the City Council passed a moratorium on tar sands exports while it wrote the ordinance. The lawsuit followed.
If reversed, the pipeline wouldn’t offer significant capacity for tar sands exports, but it would help crack the problem of moving Canada’s tar sands oil to markets overseas — if there is enough oil to ship. The city argues that is unlikely, given the recent cancellation of TransCanada’s proposed Energy East pipeline and the fact that Line 9’s capacity is already spoken for. The company disagrees.
The judge’s ruling is unlikely to end the dispute. Either side could appeal, meaning that ultimately this battle may come down to who can afford to keep fighting.