Houston Chronicle

TransCanad­a wants $15 billion from United States over Keystone XL.

- By Grant Schulte

LINCOLN, Neb. — 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 filed a request for arbitratio­n last week 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 Barack 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 multi-billion dollar investment by the U.S. Administra­tion’s arbitrary and unjustifie­d denial,” company spokesman Mark Cooper said.

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.

The $8 billion pipeline, first announced in 2008, faced numerous roadblocks from environmen­tal groups, as well as some landowners where it would have crossed.

Pipeline opponents said the claim highlights a problem with NAFTA as well as the proposed TranPacifi­c Partnershi­p, which Congress has yet to ratify. Both allow foreign companies to challenge domestic laws in front of internatio­nal arbitratio­n panels, and could be used to circumvent federal environmen­tal rules, said Michael Brune, the Sierra Club’s executive director.

“TransCanad­a filed this NAFTA challenge as a bullying tactic,” said Jane Kleeb, executive director of the anti-pipeline group Bold Nebraska.

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