The nearly two-decade-old oil pipeline saga surrounding the failed Keystone XL Pipeline is nearing its end after Calgary-based TC Energy lost a lawsuit to recoup $15 billion from the U.S. government.
The decision also raises questions about whether the Alberta government will be able to recover losses as an investor in the project.
TC Energy first proposed a 1,897-kilometre pipeline in 2005 to transport oil from Alberta to the U.S. Midwest.
The company permanently halted the project in January 2021 after U.S. President Joe Biden revoked the pipeline’s presidential permit. Only about 150 kilometres of pipe had been installed in Alberta.
A three-judge arbitration panel from the International Centre for Settlement of Investment Disputes was divided and ruled against TC Energy on Friday.
“The company is disappointed and frustrated by the tribunal’s decision to deny its claims under NAFTA,” Patrick Keyes, the company’s general counsel, said in an emailed statement Tuesday.
“This ruling is not consistent with our expectations and views of the clear interpretation of the safeguards that NAFTA and USMCA were intended to provide,” he said, referring to the United States-Mexico-Canada Agreement. “TC Energy has been treated unfairly and unjustly with its politically motivated revocation of its license.”
TC Energy said it has not recorded any potential recoveries related to the NAFTA claims in its financial statements or factored them into its forecasts.
![Dozens of sections of pipe are lined up in a row.](https://i.cbc.ca/1.5742719.1721146457!/fileImage/httpImage/image.jpg_gen/derivatives/original_780/alberta-keystone-xl-pipe.jpg)
![Dozens of sections of pipe are lined up in a row.](https://i.cbc.ca/1.5742719.1721146457!/fileImage/httpImage/image.jpg_gen/derivatives/original_780/alberta-keystone-xl-pipe.jpg)
The tribunal noted that older provisions relating to the former North American Free Trade Agreement only permitted claims based on violations that allegedly occurred while NAFTA was in force.
The Alberta government became an investor in the project in 2021, providing loan guarantees to TC Energy to help start construction of the pipeline in the province.
The same Free Trade Arbitration Tribunal that heard the TC Energy case will consider the Alberta government’s claim.
In its filing, the province is asking the tribunal to award at least C$1.6 billion in damages “as compensation for losses caused or resulting from U.S. government actions that are found to violate the terms of the CUSMA and NAFTA trade agreements.”