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October 6, 2017

South Portland to weigh impact of TransCanada’s pipeline decision on pending lawsuit

TransCanada Corp.'s decision on Thursday to scrap its proposed $12 billion Energy East pipeline adds a new twist to the Portland Pipe Line lawsuit challenging South Portland's ban on bulk crude oil imports into the city.

CBC News reported Thursday that the Calgary-based energy company, in a regulatory filing with Canada's National Energy Board, cited "existing and likely future delays resulting from the regulatory process, the associated cost implications and the increasingly challenging issues and obstacles" as factors in its decision to pull the plug. The 2,800-mile Energy East pipeline was expected to ship 1.1 billion barrels of crude oil a day from Alberta and Saskatchewan to refineries in New Brunswick and Quebec.

The Portland Press Herald reported that it's unclear whether TransCanada's decision would increase the possibility of Portland Pipe Line Corp. reversing the flow of its pipeline that runs from waterfront terminals in South Portland to refineries in Montreal. John Auers, executive vice president at a petroleum consulting firm in Dallas, told the newspaper that TransCanada's decision could elevate Portland Pipe Line's viability as an alternative conduit to move crude oil from Canada to East Coast refineries.

South Portland's 2014 Clear Skies Ordinance, which bans unloading crude oil in the city, would block Portland Pipe Line, a Canadian-owned subsidiary of ExxonMobil and Suncor Energy, from reversing the flow of its U.S.-to-Canada oil pipeline. The ordinance triggered a federal lawsuit filed by Portland Pipe Line Corp. in early 2015, which alleged the city's crude-oil ban enacted in July 2014 is interfering with interstate trade, diminishing the value of its pipeline, discriminating against Canadian interests and infringing on federal regulatory processes.

The Press Herald reported that South Portland city officials are scheduled to discuss the lawsuit, which has cost the city more than $1 million in legal fees to date, in an executive session next week.

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