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TransCanada Corp sued the U.S government in U.S. federal court on Wednesday, alleging President Barack Obama's rejection of the Keystone XL pipeline exceeded his power under the U.S. Constitution.
Obama rejected the cross-border crude oil pipeline late last year, seven years after it was first proposed. TransCanada also filed legal action under the North American Free Trade Agreement (NAFTA), saying the pipeline permit denial was "arbitrary and unjustified."
As part of the NAFTA claim, the company was seeking $15 billion.
Foreign Corporations could sue our governments
The TPP includes rights for foreign corporations to sue governments for millions of dollars in international tribunals if they can argue that a change in domestic law or policy at national, state or local level will ‘harm’ their investment, known as Investor-State Dispute Settlement (ISDS).
The tribunals consist of investment lawyers who are not independent judges but can continue to be practicing lawyers, with obvious conflicts of interest. Australia’s High Court Chief Justice and other legal experts have said that ISDS is not a fair legal system because it has no independent judges, no precedents and no appeals. Increasing numbers of cases against health, environment and even minimum wage laws show that ISDS can undermine democratic rights to regulate.
originally posted by: masqua
This will be one to watch alright. $15B is peanuts in the large scale of things, but sure to be an irritant as the case builds over the coming weeks and months. It could take years and by then there will be a change in both governments.
I like the Canadian Company saying that Obama exceeded his constitutional power. Good luck with that one.
On another note, oil is trading at $34/barrel.
The company's lawsuit in federal court in Houston does not seek legal damages but wants the permit denial invalidated and seeks a ruling that no future president can block construction.
The project ran into opposition from environmental groups in the United States and blocking it became a litmus test of the green movement's ability to hinder fossil fuel extraction in Canada's oil sands.
U.S. companies have already cut more than 86,000 jobs due to low oil prices, according to Challenger, Gray & Christmas.
And it has put $1.5 trillion of oil and natural gas projects at risk, research firm Wood Mackenzie estimates. U.S. oil rig counts have also tumbled to the lowest levels in nearly five years.
The decline in U.S. production has raised hopes the market will be able to absorb the enormous supply glut sooner rather than later.
"This is very significant. If production continues falling by 100,000 barrels per day, then we think the balance between supply and demand can happen earlier," said Per Magnus Nysveen, head of analysis at Rystad Energy.