Lansing - A controversial gasoline-pipeline project moved closer to breaking ground after a state agency approved Tuesday its planned route along Interstate 96.

The three-member Michigan Public Service Commission unanimously approved Wolverine Pipe Line Co.’s plan to replace its 65-year-old pipeline through Meridian Township and East Lansing.

The new route passes through Lansing on its way from Stockbridge to the capital city’s north side.

The company withdrew an earlier application to the commission in early 2001 after commission advisers said it was too close to homes and businesses.

“That would have gone through two elementary schools, four subdivisions and within several feet of several homes,” commission Chairwoman Laura Chappelle said. “This one is not within 50 feet of any residents, and only a few are within 150 feet.”

The commission’s decision allows Wolverine to build, operate and maintain a 26-mile pipeline despite opposition from Lansing city officials and residents. The commission determined the pipeline is needed because of the 1999 closure of an Alma refinery, which has caused an increase in tanker trucks on mid-Michigan highways.

Transporting fuel by truck is considered more dangerous than pumping it through a pipeline, and Chappelle said the pipeline will help control fuel prices.

Mayor David Hollister and Ingham County Commissioner Lisa Dedden have opposed the I-96 route, saying it poses a risk to area groundwater. Some also have argued the new route unfairly puts low-income city residents and minorities in danger.

Some critics also worry the pipeline could burst like the June 2000 accident in Jackson County’s Blackman Township. A Wolverine pipeline leaked into the ground and forced more than 1,000 residents out of their homes for several days.

Wolverine officials and the commissioners said the pipeline’s safety features will exceed federal standards.

The commission has asked the Houston-based company to install “sentinel” monitoring wells that provide early detection of pollutants in the groundwater.

Wolverine spokesman Tom Shields said the company will include the commission’s additional safety requests in the project.

The commission’s decision, however, is not the last step in the approval process.

Wolverine still is waiting for a permit from the Michigan Department of Environmental Quality to build the project through wetlands, and the company has asked affected communities for consent to proceed, something the Lansing City Council is likely to deny.

Council Vice President Carol Wood said a Thursday committee meeting will shed light on how the council will vote.

The Lansing Board of Water & Light, which has property near the pipeline route, will present information to the council at the meeting, and a vote could come as early as Monday, Wood said.

Council President Larry Meyer said City Attorney Jim Smiertka will explain the city’s legal options, and Wolverine representatives are expected to attend. A lengthy legal battle is likely if the council does not give consent, Meyer said.

“I would imagine it would go to court - at least two levels and maybe more,” he said.

Wolverine has said the company doesn’t necessarily need permission from communities to move ahead.

Wolverine officials hope to complete construction by the end of the year.

“It’s the first time it’s ever been asked,” Shields said. “We’ll cross that bridge if we get there.”

DEQ’s land and water management division spokesman John Skubinna was not available for comment and calls to DEQ spokesman Ken Silfven were not returned Wednesday.

Shields said the demand for fuel increases some 2 to 4 percent each year, and delaying the project would increase the number of trucks carrying fuel north from Jackson. About 25 trucks are used every day, Shields said.

Public Service Commissioner Robert Nelson said the pipeline would provide about 55,000 barrels of fuel and replace about 250 to 350 trucks. He also said the added safety precautions will make the pipeline “as safe as humanly possible.”

The commissioners had reason to be concerned about the pipeline’s safety.

“It’s one block away from our offices,” Nelson said.