UPDATE 1-Enbridge fined $3.32 mln for failings in Line 3 replacement project

(Adds Enbridge statement, details from DNR order)

Sept 16 (Reuters) - The Minnesota Department of Natural Resources (DNR) said on Thursday it fined Enbridge Inc $3.32 million, citing the Canadian company's failure to follow environmental laws during the construction of its Line 3 oil pipeline replacement.

"Enbridge breached the confining layer of an artesian aquifer, resulting in an unauthorized groundwater appropriation during the construction of the Line 3 replacement project near Enbridge's Clearbrook Terminal," DNR said in a statement https://www.dnr.state.mn.us/line3/index.html?__cf_chl_captcha_tk__=pmd_AkppozqlcpmJbQoZgmsgzbymZhbXN.lQuic9OCtaiAU-1631835889-0-gqNtZGzNAvujcnBszQnR.

DNR's order also requires Enbridge to implement a restoration plan to stop the unauthorized groundwater flow within 30 days and conduct additional groundwater and site monitoring.

The regulator ordered Enbridge to place $2.75 million in escrow for restoration and mitigation of any damage to the calcareous fen wetlands.

DNR referred the matter to the Clearwater County attorney for criminal prosecution. If the company violates the restoration order, it would be subject to additional misdemeanor charges under state law, DNR added.

In response, Enbridge said in a statement it would continue to work closely with the agency on the resolution of the matter.

"Enbridge has been working with the DNR since June to provide the required site information and approval of a corrective action plan, which is currently being implemented."

Enbridge is close to completing its Line 3 replacement project, which will boost the capacity of the pipeline carrying oil sands crude to Midwest refineries.

Earlier this month, Enbridge sent a notice to shippers saying it expects to offer 620,000 barrels per day of capacity on the pipeline in October, and it is expected to reach full capacity of 760,000 bpd by the end of this year.

Environmental groups oppose the project, which has faced years of regulatory delays and legal challenges. (Reporting by Swati Verma in Bengaluru; Editing by Chris Reese and Peter Cooney)