Believing that it has been unjustly deprived of the value of its multi-billion dollar investment in the U.S. energy infrastructure, TransCanada is seeking legal redress for $15 billion in damages from the federal government in Washington, D.C. after the Obama administration rejected the company's Keystone XL Oil Pipeline project last November.
The Calgary-based pipeline operator filed papers late Friday seeking arbitration under the North American Free Trade Agreement, arguing that TransCanada had every reason to believe it would win approval to build Keystone XL. Instead, President Barack Obama last November determined that the pipeline, which would have carried Canadian oil sands crude to the U.S. Gulf coast, wasn’t in the national interest. In response, TransCanada in January vowed to use arbitration provisions in Chapter 11 of NAFTA to recover costs and damages.
The pipeline was designed to carry 830,000 barrels of crude oil per day from Hardisty, Alberta, in Canada to Steele City, Nebraska, where it would have connected to existing pipelines running south to Gulf Coast refineries. The final route would have run through Montana, South Dakota, Nebraska, Kansas, Oklahoma and Texas.