TransCanada announced on Wednesday that it will sue the US government USD 15 billion for blocking the oil pipeline linking Canada’s tar sands oil with refineries on the Gulf of Mexico.
TransCanada Corp. said that the Obama administration’s denial of a permit “was arbitrary and unjustified” under Chapter 11 of the North American Free Trade Agreement (NAFTA). it also accused President Barack Obama of “exceeding his powers under the US constitution”.
President Obama announced in October that he was denying TransCanada a permit to construct a key portion of the Keystone XL pipeline on the grounds that it would worsen climate change. Environmentalists hailed his decision as a victory after campaigning against the project for more than seven years.
TransCanada accuses the Obama administration of making a “symbolic gesture”, bowing under pressure to environmentalists and the international community in advance of the UN climate talks in Paris last December. It points out that the State Department had concluded several times in the past that the pipeline would not significantly increase global greenhouse gas emissions.
TransCanada did not mince words in the notice of intent that it filed to initiate the NAFTA claim: “Stated simply, the delay and the ultimate decision to deny the permit were politically-driven, directly contrary to the findings of the administration’s own studies, and not based on the merits of Keystone’s application.”
The White House and State Department have declined to comment on the lawsuit or the NAFTA challenge, reports a Calgary news station.
TransCanada is seeking to recover USD 15 billion in costs and damages.