On July 2, 2021, TC Energy Corporation, the Canadian developer of the Keystone XL pipeline, announced that it had filed a Notice of Intent to initiate a legacy North American Free Trade Agreement (NAFTA) claim under the United-States-Mexico-Canada Agreement to recover damages resulting from the revocation of the pipeline’s presidential permit.[1] The 1,210-mile pipeline project, located in central North America and running north to south, was slated to carry 830,000 barrels of heavy crude per day from Alberta, Canada, to Nebraska, U.S. However, in January 2021, President Biden issued an executive order rescinding the pipeline’s border crossing permit amid concerns that burning oil sands crude would worsen climate change.[2] As a result, TC Energy announced in June 2021 that it was canceling the project. The developer is seeking to recover more than $15 billion in damages that it has suffered as a result of the Biden administration’s decision.

This is not the first time TC Energy has challenged the U.S. government under NAFTA. In 2016, TC Energy, then known as TransCanada Corp., filed a notice of NAFTA arbitration after President Obama denied the pipeline a border-crossing permit.[3] The company dropped its $15 billion claim when President Trump signed an executive order approving the pipeline and granting TC Energy the border-crossing permit in 2017.

[1] https://www.tcenergy.com/announcements/2021-07-02-tc-energy-commences-nafta-claim-following-revocation-of-keystone-xl-presidential-permit/

[2] https://www.whitehouse.gov/briefing-room/presidential-actions/2021/01/20/executive-order-protecting-public-health-and-environment-and-restoring-science-to-tackle-climate-crisis/

[3] https://www.tcenergy.com/announcements/2016/2016-01-06transcanada-commences-legal-actions-following-keystone-xl-denial/