The Canadian company behind the canceled Keystone XL pipeline filed a formal claim for arbitration this week under the North American Free Trade Agreement to claim more than $ 15 billion in economic damages from the revocation by the Biden administration of the permit for the cross-border oil project.
In its Monday filing, TC Energy criticizes the permit cancellation as “unfair and unfair” and argues that the US government should pay damages for the “regulatory roller coaster” the company has endured in seeking to build the pipeline.
“Acting on the climate crisis will require trade reforms, including the removal of these investor provisions.”
Erin LeBlanc, Lecturer at the Smith School of Business in Kingston, Ont. Recount Radio-Canada News this amount represents “the largest claim by a Canadian organization against the US government.”
The company said in a statement announcing its filing that it “has a responsibility to our shareholders to seek to recover the losses suffered as a result of the revocation of the permit, which resulted in the shutdown of the project.”
The pipeline project, which would have transported oil sands from Alberta, Canada, to the US Gulf of Mexico coast, was first proposed in 2008. Following continued grassroots pressure, the Obama administration ultimately rejected the pipeline, resulting in a since-abandoned NAFTA claim. This permit rejection was overturned by the Trump administration, which promotes fossil fuels.
President Joe Biden then revoked the permit during his first few hours in office – a move attributed to relentless Indigenous-led activism and hailed by climate groups as “a huge victory for the health and safety of Americans and of our planet ”.
In July, a month after declaring the project dead, TC Energy filed its intention to use the investor-state dispute resolution (ISDS) provisions of Chapter 11 of NAFTA to recoup perceived economic losses.
As such, the new deposit is not surprising, author and water rights expert Maude Barlow Noted in a tweet on Tuesday. “This abominable practice”, she added, referring to the ISDS mechanism, “had acquired rights in the old NAFTA”.
While the ISDS provision of NAFTA has been “gutted” under the United States-Mexico-Canada Replacement Agreement (USMCA), the company is making a “legacy” claim of NAFTA. According to the advocacy group Public Citizen, the ISDS is “totally rigged” in favor of business.
As the group explains on its website:
As part of ISDS, [a tribunal of three corporate lawyers] can order US taxpayers to pay businesses unlimited amounts of money, including for the loss of “expected future profits” the business would have earned in the absence of the law and order it is attacking.
Multinational companies need only convince lawyers that a law protecting public health or the environment violates their special “trade” agreement rights. Decisions of in-house lawyers are not subject to appeal. And if a country doesn’t pay, the company can seize a government’s assets – bank accounts, ships, planes – to extract the ordered compensation.
Responding to the dispute between TC Energy and the US government, Bloomberg reported that “the court cannot compel a country to change its laws in this matter or force approval of the pipeline, but it could award damages for lost profits and costs incurred by the company.”
In a tweet on Tuesday, Ben Lilliston, director of rural strategies and climate change at the Institute for Agriculture and Trade Policy, placed TC Energy’s case against the backdrop of the global climate emergency.
“The legacy of NAFTA of granting multinational corporations special rights to sue governments that take action to protect the environment continues,” he said. wrote. “Acting on the climate crisis will require trade reforms, including the removal of these investor provisions.”