Keystone Pipeline

TransCanada Files $15 Billion Suit Against U.S. Government Over Keystone Rejection

On Wednesday, TransCanada Corp sued the U.S. government in an attempt to overturn President Obama’s Keystone XL pipeline rejection. In a second claim, TransCanada is seeking $15 billion in damages under the North American Free Trade Agreement (NAFTA).

The Keystone XL pipeline was dealt a blow last year after President Obama vetoed legislation that had been approved by Congress. The Senate later failed to override the veto. The pipeline would transport oil from Canada’s tar sands to pipelines in refineries in Houston and other locations on the Gulf of Mexico.

Reuters reports that TransCanada filed the the lawsuit in a federal court in Houston, Texas, calling the rejection of its permit to build the pipeline “unconstitutional.” The company is asking the court to overturn Obama’s permit denial to complete the pipeline and a ruling that would block any future president from stopping the pipeline completion.

The Houston lawsuit names several officials as defendants, including U.S. Secretary of State John Kerry, U.S. Attorney General Loretta Lynch, U.S. Homeland Security Secretary Jeh Johnson and Sally Jewell, Secretary of the Department of Interior.

Under the NAFTA claim, TransCanada is requesting $15 billion to recover its investment in the pipeline. TransCanada said it “had every reason to expect its application would be granted.” Chapter 11 of the NAFTA trade agreement between Canada, Mexico and the United States gives investors the right to make claims against governments.

TransCanada told Reuters it was “prepared for a lengthy process that could take several years.”

Despite President Obama’s rejection of the project, lawmakers in some states still support the planned pipeline. South Dakota’s Public Utilities Commission recently approved TransCanada’s permit to cross into the state.

On Monday Commissioner Gary Hanson said, “If the company secures a presidential permit and the pipeline is built, the PUC will monitor the progress to ensure the construction conditions are met.”

TransCanada spokesman Mark Cooper told Courthouse News: “This decision in South Dakota further strengthens our commitment to Keystone XL, the safest and most environmentally sound way to transport needed Canadian and American oil to the people of the United States.”

The pipeline has been resisted by landowners in Nebraska, as well as indigenous communities. Critics also say the pipeline’s purported increasing of jobs is false.

There have also been disputes over official documents related to the permitting of the pipeline. For example, in early July, Truth In Media reported that Secretary of State John Kerry was issued a subpoena seeking the release of all “reports, recommendations, letters and comments received by the State Department from the advising agencies pursuant to Executive Order 13337 regarding the permit for the Keystone XL pipeline.”

In a statement accompanying the subpoena, Committee Chairman Jason Chaffetz stated that the State Department has been “uncooperative” and “shown an unwillingness to recognize the Committee’s legitimate interest in obtaining information.”