[ROCKMAN]

sub - If I had to guess I would bet TransCanada is just looking for some financial penalty. I seriously doubt they would build the pipeline today if they were suddenly given the permit. It would be a bit ballsy but the US could grant the permit to settle the dispute and call their potential bluff. But I would think they might still file a claim for the venue they might have lost in the past even if there were no future revenue projected.

[Tanada]

Quick question for the ROCKMAN, if the GOP wins this November AND the price of oil is back up around $60/bbl could TransCanada still file their complaint? Or has that window of opportunity closed?

[ROCKMAN]

T - Not a lawyer so I'll pass. But even more true today: I doubt they would build if granted the permit now. Might become an issue again in 5 to 1o years...or longer.

[vox_mundi]

How "Trade Agreements" castrate sovereignty ...

TransCanada formally seeks NAFTA damages in Keystone XL rejection

$this->bbcode_second_pass_quote('', ' ') TransCanada Corp is formally requesting arbitration over U.S. President Barack Obama's rejection of the Keystone XL pipeline, seeking $15 billion in damages, the company said in legal papers dated Friday.

TransCanada submitted a notice for an arbitration claim in January and had then tried to negotiate with the U.S. government to "reach an amicable settlement," the company said in files posted on the pipeline's website.

"Unfortunately, the parties were unable to settle the dispute."

TransCanada said it then filed its formal arbitration request under North American Free Trade Agreement (NAFTA) provisions, seeking to recover what it says are costs and damages.

[ROCKMAN]

Vox - Appears to be old news but I hadn't seen it before. From last January:

"On Jan. 6, TransCanada went to court to claim that the Obama administration’s failure to approve the Keystone XL pipeline violates U.S. obligations under the North American Free Trade Agreement, or NAFTA. The company is asking for $15 billion in compensation from U.S. taxpayers.

This mixes two challenges confronting President Obama and Democratic politicians in recent years. Environmentalists have turned the ecologically questionable tar sands pipeline into a no-fly-zone in domestic politics. Meanwhile, labor and other groups have made opposition to NAFTA-style deals essential for their electoral support. In the face of this pressure from the left, even one-time advocates of both the pipeline and trade deals like Hillary Clinton have reversed course on both. The Senate failed to override Obama’s veto of the Keystone pipeline.

The U.S. has never lost an ISDS lawsuit. Keystone might break the winning streak.

A bit of background before moving into what TransCanada’s case could portend. NAFTA (much like the proposed Trans-Pacific Partnership, or TPP) allows foreign investors to bring direct legal challenges against a wide range of host state regulations. These cases are heard outside of national courts, by panels of three arbitrators selected by the litigating investor and government. These arbitrators lack the formal power to overturn host state policies, so instead order the payment of cash compensation that can then be enforced in national courts.

While the U.S. has never lost a NAFTA case, Canada and Mexico have — along with dozens of other countries under similar trade and investment pacts. This investor-state dispute settlement (ISDS) system has become increasingly controversial. Investors have controversial new rights to sue countries. Here’s why this matters for the U.S. Could the Keystone NAFTA case end the US’ winning streak? I predicted the possibility four years ago.

All else equal, the case would seem like a good bet for the investor. As detailed in TransCanada’s initial NAFTA filing, after initial enthusiasm, the U.S. sent wildly mixed messages about whether the pipeline would be approved – delaying the review process far beyond the average length of time. The U.S. has approved other pipelines, and admitted that this process was different in its degree of politicization. Even critics of Keystone XL (including Obama) admit that blocking the pipeline will have a limited impact on climate emissions, and others note that the campaign was motivated primarily by social movement politics. This is far from the dispassionate, consistent regulatory process that investment arbitrators tend to favor."

So we'll probably have to wait a year is so to see if our tax payers get dinged.

[Zarquon]

Although I wonder if his size calculations are a bit off. All the oil produced in the US would fit through a, what, 10' pipeline flowing at 4 m/s?

[ROCKMAN]

Z - You know what they say: it ain't the size but how you use it. LOL. And we use a lot of it:

The United States has the largest network of energy pipelines in the world, with more than 2.4 million miles of pipe. The network of crude oil pipelines in the U.S. is extensive. There are approximately 72,000 miles of crude oil lines in the U.S. that connect regional markets.

[ROCKMAN]

So TransCanada wants to sue President Obama because he wouldn't grant the border crossing permit. Big deal: in what court could they win? Turns out this situation might warrant a closer look at the TPP...Trans Pacific Partnership. Thanks to another trade deal, NAFTA, TransCanada might see a payday. From last September -

TransCanada seeks $15B for rejection of Keystone pipeline

"TransCanada filed a request for arbitration Friday under the North American Free Trade Agreement, arguing that the State Department's actions led the company to believe the project would win approval. Obama rejected a federal permit for the project in November, saying it would have undercut the nation's reputation as a global leader on addressing climate change. The Calgary-based company argues that it moved forward with the project under the assumption that it would win approval, given numerous federal reviews and the government's approval of the original Keystone pipeline. It also alleges that the administration rejected the project to bolster its environmental credentials.

Pipeline opponents said the claim highlights a problem with NAFTA as well as the proposed Tran-Pacific Partnership, which Congress has yet to ratify. Both allow foreign companies to challenge domestic laws in front of international arbitration panels."

So a big part of President Obama's legacy may depend on the decision of an international arbitration panel.

[Tanada]

$this->bbcode_second_pass_quote('ROCKMAN', 'S')o TransCanada wants to sue President Obama because he wouldn't grant the border crossing permit. Big deal: in what court could they win? Turns out this situation might warrant a closer look at the TPP...Trans Pacific Partnership. Thanks to another trade deal, NAFTA, TransCanada might see a payday. From last September -

TransCanada seeks $15B for rejection of Keystone pipeline

"TransCanada filed a request for arbitration Friday under the North American Free Trade Agreement, arguing that the State Department's actions led the company to believe the project would win approval. Obama rejected a federal permit for the project in November, saying it would have undercut the nation's reputation as a global leader on addressing climate change. The Calgary-based company argues that it moved forward with the project under the assumption that it would win approval, given numerous federal reviews and the government's approval of the original Keystone pipeline. It also alleges that the administration rejected the project to bolster its environmental credentials.

Pipeline opponents said the claim highlights a problem with NAFTA as well as the proposed Tran-Pacific Partnership, which Congress has yet to ratify. Both allow foreign companies to challenge domestic laws in front of international arbitration panels."

So a big part of President Obama's legacy may depend on the decision of an international arbitration panel.

[ROCKMAN]

T - "...if President trump approves the permit January 20, 2017 does the lawsuit disappear?" Not necessarily. First, the delay cost TransCanada a loss of revenue. It did have a good bit if sunk capex. Second, part of the economic justification for the northern leg of KXL was to haul N Dakota oil and an alternative pipeline is underway. Add that to the oil price collapse and it might not get built today even with approval. Which actually helps TransCanada's case with the international arbitration committee: lost revenue that can't recovered if the pipeline can't be justified now.

[ROCKMAN]

"T - "...if President trump approves the permit January 20, 2017 does the lawsuit disappear?" Not necessarily.".

And now an update: TransCanada has dropped its $15 BILLION lawsuit against the US govt as result of President Trump approving the border crossing permit. Fortunate in that the suit would have not been heard in court but before NAFTA arbitrators. And their decision would be final. Not that a TransCanada win would have been certain. But according to those who have studied the NAFTA arbitrators' past rulings TransCanada had a shot at getting something from the US govt.

[Cog]

Perhaps Trump made Trudeau an offer he couldn't refuse.

[ROCKMAN]

Cog - Perhaps. Sometimes a very important aspect of "the art of the deal" is to not let others know you cut a deal let alone the details of the trade.

[ROCKMAN]

UPDATE!!! Just announced: an undersecretary will sign the border crossing permit for the Keystone XL Pipeline next week. The only question now is whether there's sufficient economic justification for it. And if not now...when? Especially given the North Dakota Pipe Line is also scheduled to begin flowing next week. The DAPL usurped some of the financial power of KXL: a complex dynamic explained before.

[Cog]

Build it and we can figure out what to do with the oil later.

[Cog]

Oh, the protesters are frightful,
But the winning so delightful,
Since we've got places to go,
Let it flow! Let it flow! Let it flow!

[Plantagenet]

This is going to save lives and reduce US CO2 emissions----the giant oil trains were very very dangerous and emitted huge amounts of CO2.

The only person who should be crying about this is billionaire Warren Buffett who is going to see a little less money coming in to his railroads.

Cheers!

[ROCKMAN]

"Build it and we can figure out what to do with the oil later." Will never be built on a "spec basis": such muilti-$billion pipelines only get built when potential oil owners commit (bonded, etc) to shipping a minimum volume at a set tariff fee. We need to first see if TransCanada advertises an "open season" when oil owners make those commitments.

There was an initial open season years ago that was constantly extended as the permit was delayed which stopped companies from commuting. The only way to get those commitments now is to offer much lower tariff rates then being charged now. That should be rather difficult since the current transporters can cut their rates.

[Satori]

Trump promised this would provide and I quote "TENS OF THOUSANDS OF JOBS"

I'm packin' up and headin' fer the pipeline baby !!!

[ROCKMAN]

S - Actually with the completion of the Dakota Access PL we'll probably see a net loss of pipeline construction jobs this year.