TC Energy Seeks $15B in Damages Following Keystone XL Pipeline Cancellation

TC Energy Corporation, the Canadian company which was building the Keystone XL pipeline before its permit was cancelled by President Joe Biden through an executive order, announced on Friday that it plans to initiate a North American Free Trade Agreement (NAFTA) claim to seek over $15 billion damages that were caused to the company by the permit’s cancellation. This comes weeks after TC announced it would abandon the project.

The company claimed that the U.S. government breached its NAFTA obligations and that it has the right to file the claims under the United States-Mexico-Canada Agreement. TC Energy’s notice of intent to file the claims was sent to the U.S. Department of State, Office of the Legal Advisor, according to the press release. 

TC Energy has previously explained that the cancellation caused it to layoff thousands of workers. The pipeline was designed to transport oil from Canada through multiple states and to the Gulf of Mexico.

The Keystone XL pipeline has already been the center of multiple lawsuits, and it has been a controversial project for over a decade. Some lawsuits filed previous to its cancellation by environmental groups and Indian tribes claimed that permits for the pipeline breached laws and that the harm to the environment from the construction and use of the pipeline would be significant. 

TC Energy suspended work on the project the day before Biden took office, following reports that his administration planned to cancel the project.

One lawsuit filed by 21 states in March contested the project’s cancellation arguing that the action was outside of the power granted to the President in the Constitution. This lawsuit cited multiple environmental and economic studies completed by the government which showed that it would have a negligible environmental impact.