Key­stone firm seeks dam­ages

San Francisco Chronicle - - BUSINESS -

The com­pany that pro­posed the Key­stone XL pipeline is seek­ing $15 bil­lion in dam­ages from the fed­eral govern­ment af­ter the Obama ad­min­is­tra­tion re­jected the Canada-to-Texas project, a com­pany spokesman said Mon­day.

TransCanada Inc. filed a re­quest for ar­bi­tra­tion Fri­day un­der the North Amer­i­can Free Trade Agree­ment, ar­gu­ing that the State Depart­ment’s ac­tions led the com­pany to be­lieve the project would win ap­proval. Pres­i­dent Obama re­jected a fed­eral per­mit for the project in Novem­ber, say­ing it would have un­der­cut the na­tion’s rep­u­ta­tion as a global leader on ad­dress­ing cli­mate change.

The Cal­gary-based com­pany ar­gues that it moved for­ward with the project un­der the as­sump­tion that it would win ap­proval, given nu­mer­ous fed­eral reviews and the govern­ment’s ap­proval of the orig­i­nal Key­stone pipeline. It also al­leges that the ad­min­is­tra­tion re­jected the project to bol­ster its en­vi­ron­men­tal cre­den­tials.

“TransCanada has been un­justly de­prived of the value of its multi­bil­lion-dol­lar in­vest­ment by the U.S. Ad­min­is­tra­tion’s ar­bi­trary and un­jus­ti­fied de­nial,” com­pany spokesman Mark Cooper said. “It is our re­spon­si­bil­ity to take the ac­tions we deem ap­pro­pri­ate to pro­tect our rights.”

The pipeline would have car­ried 830,000 bar­rels of crude oil per day from Hardisty, Al­berta, in Canada to Steele City, Neb., 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.

A State Depart­ment spokesman said the agency doesn’t com­ment on pend­ing lit­i­ga­tion.

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