TC Energy Corp.’s Keystone XL oil pipeline project has lost the opening round of a legal battle to overturn an April ruling by a U.S. federal court that canceled its water crossing permit.
U.S. District Judge Brian Morris rejected a request to revive Keystone’s Nationwide Permit 12, which the U.S. Army Corps of Engineers issued to enable TC to begin construction.
The second decision enforced a court order for the Army Corps to increase its environmental standards by consulting with the U.S. Fish and Wildlife Service on risks posed by pipeline projects to wildlife protected under the Endangered Species Act.
The contested permit has been restored for other utility projects deemed less hazardous, such as power transmission lines, and for maintenance of established services.
Opponents of Keystone called the court ruling “yet another victory in the fight to ensure that it is never built.” TC vowed to appeal.
With financial support from the Alberta government, construction has begun on the pipeline to export up to 830,000 b/d by Canada’s top natural gas user, thermal oilsands production. In March, Alberta and TC announced a C$7.5 billion ($5.3 billion) agreement to begin construction.
The deal includes a C$1.5 billion ($1.1 billion) government ownership stake plus a C$6 billion ($4.2 billion) provincial loan guarantee to kickstart the work.
While still awaiting contested approvals in the United States, TC said the government support would enable work on the 259-kilometer (155-mile) Canadian leg from Central Alberta to the U.S. border.
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