Kalamazoo River Cleanup Costs Jump

Wednesday, September 28, 2011 @ 02:09 PM gHale


It will cost Enbridge Energy’s close to $700 million to cleanup the Kalamazoo River oil spill, which is $50 million over what the company can collect through its pollution liability insurance policy.

The company has been paying for all of the cleanup-related costs and is working with its insurance company for reimbursement.

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Enbridge submitted a report to the Security and Exchange Commission saying the entire cleanup will cost close to $700 million — 20 percent more than their previous estimate of $585 million. The cleanup estimate also does not include any fines or penalties from the government.

“Our estimated cost to clean up the spill also includes what we’ve paid in claims and what we are forecasting based on the best information available,” said Enbridge spokeswoman Terri Larson.

Enbridge reported more than 800,000 gallons of oil spilled into the Kalamazoo River in July 2010.

The company said it also expects to pay $48 million related to a spill that occurred in September 2010 in Romeoville, Ill.

Larson said there are four major reasons why the estimate for the Marshall spill has increased: testing, continual reassessments, active remediation of the shoreline, and increased operations to recover submerged oil.

The Alberta, Canada-based pipeline company does not have an estimate as to how much longer the cleanup will take, Larson said. In July 2010, Enbridge had said the cleanup would be a multiyear operation.

“We don’t know if the (estimated cost) will go up,” Larson said, noting the company promised to continue the cleanup until affected areas are clean.

Enbridge spokesman Jason Manshum said the cleanup of 200 acres of submerged oil identified in June will likely be complete in October. The EPA had originally set an Aug. 31 deadline.

On Sept. 16, the EPA said it had recovered 766,288 gallons of oil and it spent $33.9 million thus far on cleanup costs, which the EPA has said Enbridge will repay.

Enbridge said it expects to have paid about 80 to 90 percent of the estimated costs by the end of this year.

According to the company’s website, it also has made $422.3 million in payments associated with the spill — with nearly $129 million paid in the first six months of this year.

Those payments have covered the entire cleanup cost, including payments to contractors, as well as any claims with residents that had been resolved.



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