CALGARY, Alberta—The Canadian province of Alberta on Wednesday formally initiated a trade challenge to recover its investment in the Keystone XL oil pipeline, which was scrapped in 2021 after the United States cancelled a key permit.
Alberta, Canada’s largest oil-producing province, had invested C$1.3 billion in the project and is seeking compensation from the United States through a legacy North American Free Trade Agreement claim, under the new Canada-United States-Mexico Agreement.
Keystone XL would have carried 830,000 barrels per day of oil from Alberta to the U.S. Midwest, but was held up for a more than a decade by environmental opposition and regulatory hurdles, before U.S. President Joe Biden finally scuttled the project by revoking a presidential permit last year.
The pipeline’s developer TC Energy also filed a legacy NAFTA claim seeking more than $15 billion in damages last year.
“After examining all available options, we have determined a legacy claim is the best avenue to recover the government’s investment in the Keystone XL project,” Alberta Energy Minister Sonya Savage said in a statement.
“We remain disappointed about the events and circumstances that led to the cancellation of this project.”
